Metal Production

Rare earth metal production is the step that reduces separated rare earth oxides to metals and alloys that magnet makers can use. Oxides work for catalysts, optics and ceramics, but magnets need metal with very low impurity levels (IEA, May 2026). The International Energy Agency says supply constraints are most acute in magnet manufacturing and in this "metallisation" stage (IEA).

Where rare earth metal production sits in the supply chain

The IEA lists the chain as extraction, beneficiation, chemical upgrading, separation into oxides, metal refining, alloying and magnet manufacturing (IEA). The U.S. Department of Energy groups metal refining with separation as processed materials production, steps it says are often associated with the midstream of the magnet supply chain. The DOE says the metals most used in magnets are didymium (NdPr), pure neodymium and ferrodysprosium (DyFe), with terbium metal used less often (DOE, February 2022).

Molten-salt electrolysis for NdPr metal

The DOE describes cells that typically use a graphite anode and a tungsten cathode. Oxide is fed into a molten electrolyte of lithium fluoride and the fluoride of the target rare earth, typically 80 to 90% rare earth fluoride (DOE).

The anode is consumed and gives off carbon monoxide and carbon dioxide, and the carbon monoxide must be treated before release. If the bath runs short of oxide, the "anode effect" consumes electrolyte and generates tetrafluoromethane, a greenhouse gas the DOE puts at 6,200 times the potency of CO2 (DOE). The IEA calls molten salt electrolysis the dominant method in China and says it is particularly energy intensive (IEA).

Calcium reduction for dysprosium and terbium

Dysprosium and terbium melt at 1,407°C and 1,356°C, above neodymium, and are typically produced by metallothermic reduction (Hung et al.). In calciothermic reduction, calcium metal reduces an anhydrous rare earth fluoride, leaving calcium fluoride as the byproduct (Hung et al.). The IEA says vacuum induction chambers are used to reduce heavy rare earth metals, equipment built by very few producers (IEA).

The fluoride feed is conventionally made with hydrofluoric acid or dry hydrogen fluoride, and Ames National Laboratory researchers wrote in 2025 that HF's health hazards create a considerable technical gap in preparing the fluoride feed (Karati et al., Nature Communications, May 2025). REEx has covered Ames's alternative feedstock, which avoids HF (REEx, May 2025).

Alloying to strip-cast NdFeB

The DOE describes alloying as induction melting the metals, then strip casting, in which the melt is poured onto a rotating, cooled cylinder to form a fine-grained alloy that is later milled into powder (DOE). The IEA says strip casters have few suppliers outside China (IEA). The powder then goes to magnet manufacturing.

Who produces rare earth metals (as of October 2026)

In February 2022, the DOE estimated, based on consultation with experts, that China held about 90% of rare earth metal refining capacity in 2020. It also noted that no reliable information exists on how much metal refining happens where. It said metal refining took place in a handful of Southeast Asian countries, including at a Vietnam Rare Earths JSC plant, with smaller amounts in Estonia and the U.K. (DOE). In August 2026, REEx suggested that China controls roughly 90% of rare earth smelting, separation and metal processing combined, and noted that China's exact share of oxide-to-metal conversion is not independently published (REEx).

• MP Materials, Fort Worth, Texas. MP commissioned electrowinning at its Independence plant in 2024 to make NdPr metal from NdPr oxide, and added strip casting for NdFeB alloy flake in 2025 (MP Materials 10-K, February 2026). Sales of NdPr metal to GM began in the first quarter of 2025 (MP Materials second-quarter 2026 10-Q).
• USA Rare Earth and Less Common Metals, U.K. and France. USA Rare Earth bought Less Common Metals, a metal and alloy maker in Cheshire, in November 2025. As of August 2026 it was developing a 3,750 metric ton per year metal and alloy plant at Lacq, France, and a planned Blacksburg, South Carolina site in early-stage development (USA Rare Earth 10-Q, August 2026).
• Energy Fuels, Ochang, South Korea. Energy Fuels completed its purchase of Australian Strategic Materials in August 2026. It says the Korean Metals Plant has 1,300 metric tons a year of existing NdFeB alloy capacity and commercial NdPr metallization, and is developing dysprosium and terbium metallization (Energy Fuels, August 28, 2026).
• Phoenix Tailings, Exeter, New Hampshire. The Exeter plant was producing NdPr and dysprosium-iron alloy when it opened in October 2025 (NHPR).
• Lynas Rare Earths. Lynas has NdPr metal made under a tolling arrangement with a metal making partner (Lynas 2026 Annual Report, August 2026).
• Santoku, Japan. REEx reported in August 2026 that Santoku has made electrolytic neodymium since 1985 but publishes no current tonnage (REEx, August 2026).

Why metal production is a bottleneck

The IEA says energy is one of the largest costs in metal conversion and that designs for highly energy-efficient electrolysis cells are closely held and not widely available outside China (IEA). Planned production of metals, alloys and magnets from projects outside China announced as of early 2026 totals about 18,000 metric tons of magnet rare earth content in 2035, the IEA says, roughly a third of diversified mining capacity (IEA).

Output can trail installed capacity. REEx reported that the Korean Metals Plant dispatched about 45 metric tons of NdFeB alloy and NdPr metal in the June 2026 quarter, and said a redundant allied supply chain is more plausibly five to ten years away (REEx, August 2026).

Frequently asked questions