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What Are Rare Earth Elements (REEs)?

Definition and classification of Rare Earth Elements (REEs)

Rare Earth Elements, or REEs, form a group of 17 metallic elements found in the Earth's crust. This group includes elements like neodymium, dysprosium, samarium, lanthanum, yttrium, and scandium. These elements serve as essential ingredients for many modern technologies. Electric vehicles, smartphones, wind turbines, and advanced military equipment all rely on REEs to function.

Scientists classify REEs into two main categories based on their position in the periodic table. The first category contains the 15 lanthanide elements. These elements start with lanthanum (atomic number 57) and end with lutetium (atomic number 71). The second category includes yttrium and scandium. These two elements often occur in the same mineral deposits as lanthanides and share similar chemical properties.

Yttrium finds use in making efficient Light Emitting Diodes (LEDs). Scandium adds strength to aluminum alloys used in aerospace components. This classification helps us understand the specific roles different REEs play in various applications. Each element offers unique capabilities.

China produces a large share of the world's REE supply. Estimates suggest China mines between 70 percent and 90 percent of the global total. Furthermore, China controls about 85 percent of the complex process required to separate and refine these elements into usable materials. This market dominance gives China considerable influence over global REE availability.

In 2025, the Chinese government imposed export restrictions on seven key REEs. This action created concern among nations and industries that depend on these materials. The United States, for example, imported roughly 75 percent of its rare earth compounds and metals from China between 2019 and 2022. Such heavy reliance highlights potential vulnerabilities in supply chains.

Unique properties and applications

REEs possess unique magnetic, optical, and catalytic properties. These characteristics make them indispensable for many high-technology applications. Despite their name, "rare earths" are not geologically rare. The Earth's crust holds over 90 million metric tons of REE reserves. Some REEs, like cerium and lanthanum, are more abundant than copper or lead. Others, such as neodymium, praseodymium, and scandium, exist in smaller quantities.

The challenge lies in extracting REEs. They are rarely found in concentrated deposits like gold or silver. Instead, they mix with other minerals, sometimes including radioactive elements like thorium. Separating REEs requires difficult and costly chemical processes. These processes generate substantial waste and can cause environmental damage, including air and water pollution. Researchers are developing cleaner extraction methods. One new technique uses peptides, a type of biological molecule, to selectively bind and isolate REEs, reducing waste.

The special properties of REEs enable a wide array of applications. Neodymium and dysprosium combine to create the world's strongest permanent magnets. These magnets are lightweight yet powerful. They form the heart of electric motors in many electric vehicles (EVs) and generators in wind turbines. It is important to note that some EV designs, like the Tesla Model S, use motors that do not require rare earth magnets. The market for rare earth magnets reached $7.8 billion in 2024. Experts project it will grow to about $44.1 billion by 2040.

Other REEs perform different functions. Lanthanum acts as a catalyst in oil refineries, helping convert crude oil into gasoline. Cerium serves as a highly effective polishing agent for glass surfaces, including LCD screens. Yttrium contributes to the bright light produced by LEDs. Europium provides the red color essential for vibrant displays on televisions and computer monitors.

REEs are also critical for national defense. Military forces use them in radar systems to detect aircraft and missiles. They enable night vision equipment for operations in darkness. REEs feature in precision guidance systems for missiles and smart bombs. The scale of use is considerable. Each F-35 fighter jet contains approximately 900 pounds of REE materials. A Virginia-class submarine requires over 9,000 pounds of these elements.

Global demand for REEs continues to climb. Annual demand stood near 200,000 tons in 2023. Projections show demand could exceed 315,000 tons by 2030. This increase stems from the growth of clean energy technologies and advanced electronics. As nations pursue green energy goals and develop new devices, securing a reliable supply of REEs becomes a central economic and security issue.

Historical Context

Evolution of REE usage in technology and defense

Rare Earth Elements were not always central to technology and defense. Their widespread use grew significantly over the past few decades. Early uses existed, but the invention of new technologies created surging demand. These technologies needed the special magnetic, optical, and electronic properties unique to REEs. Think of the powerful tiny magnets in smartphones and hard drives, or the bright colors in flat-screen displays.

Global production numbers clearly show this growth. In 1995, the world mined approximately 75,700 tonnes of REEs. By 2023, annual production leaped to over 350,000 tonnes. This dramatic rise mirrored the expansion of consumer electronics, electric vehicles, wind turbines, and other advanced industries.

China played a key part in meeting this growing appetite. Its production capacity expanded fast. By 2023, China mined 240,000 tonnes of REEs. This amount accounted for about 70 percent of the entire world's output that year. This concentration of mining and processing power in one country shaped the supply landscape.

Defense applications for REEs also multiplied. Modern military systems depend heavily on these elements. REEs enhance guidance systems for missiles. They enable powerful lasers and sonar systems. They strengthen components in jet engines. An F-35 fighter jet, for instance, contains about 900 pounds (roughly 400 kilograms) of rare earth materials. This increasing military use tightly linked national security interests to the availability of REEs.

Past supply chain challenges and lessons learned

This heavy reliance on globally concentrated production created vulnerabilities. Several events in recent history exposed the risks of fragile REE supply chains. Trade disputes and deliberate export restrictions sent shockwaves through dependent industries worldwide.

The world learned critical lessons about supply chain security. China's dominance became a major focus point. China controls not only a large share of mining but also processes over 90 percent of the world's REEs into usable metals and alloys. This processing control gives China substantial market leverage. On several occasions, China restricted or threatened to restrict exports during political disagreements.

Recent trade friction between the United States and China highlighted these dangers again. The U.S. imported around 70 percent of its required REEs directly from China between 2020 and 2023. China limited exports of gallium and germanium in 2023, metals crucial for semiconductors and defense applications. In February 2025, China placed restrictions on 25 different rare earth metals vital for technology manufacturing. Then, in April 2025, it announced export controls on seven more key REEs.

These actions triggered immediate alarms in the United States and other nations. Some U.S. companies reported their rare earth inventories could last only 40 to 60 days. Defense analysts warned that military stockpiles of essential materials might deplete within months if imports stopped completely. Prices for certain REEs reacted sharply. The price of dysprosium reportedly jumped 30 percent following export control announcements.

These crises underscored the need for diversified and resilient supply chains. The COVID-19 pandemic provided similar lessons across many industries. Roughly 93 percent of companies reported pandemic-related supply chain disruptions. Notably, companies that had already diversified their suppliers beforehand experienced 30 percent fewer delays.

In response to REE vulnerabilities, the U.S. government initiated several actions. An executive order signed on April 15, 2025, mandated a review of dependencies on foreign minerals. The Department of Defense invested over $439 million starting in 2020 to foster domestic REE capabilities. The stated goal is to establish a complete, secure U.S. rare earth supply chain by 2027. An additional $500 million investment over five years aims to support U.S. mining and processing projects.

Efforts now focus on increasing domestic production and processing. The Mountain Pass mine in California remains the only active U.S. rare earth mine, producing about 15 percent of global mined output. However, much of its raw material still travels to China for final processing. New mining projects, like the Halleck Creek project in Wyoming with its large potential reserves, represent future domestic sources. Exploring deep-sea mining and improving recycling methods are also part of the strategy. Currently, less than 5 percent of REEs are recovered through recycling.

Building international partnerships is another key lesson learned. The Minerals Security Partnership, launched in 2022, brings together the U.S. and allied nations to secure critical mineral supply chains. Collaborations with resource-rich allies like Canada and Australia aim to develop production capacity outside of China. Countries like India, holding the world's fifth-largest REE reserves, are also increasing their production goals. These past supply shocks directly fuel the current strategic push for secure, reliable, and diverse sources of rare earth elements.

Current Relevance

Why REEs are critical to modern national security

Rare Earth Elements (REEs) stand today as materials essential to the national security of the United States. These 17 minerals function as critical ingredients in the advanced technologies that underpin modern military strength. The unique magnetic and electronic properties of REEs enable performance levels that other materials cannot match.

Consider America's top defense systems. The F-35 fighter jet, a cornerstone of U.S. air power, requires approximately 900 pounds of rare earth materials. These elements contribute to its stealth capabilities, sensors, and electronic warfare systems. Developing technologies like hypersonic missiles also rely on REEs for components that withstand extreme conditions. Without a secure supply, the ability to produce and field such vital military hardware faces serious risks.

The main national security challenge arises from where REEs come from. China currently produces about 70 percent of the world's raw rare earth ores. Even more critical, China dominates the complex chemical processes needed to refine these ores into usable metals and alloys, controlling about 90 percent of global refining capacity. The United States imports a large share of its REE needs, over 60 percent, much of it sourced from or processed by China. This dependence creates a direct vulnerability for U.S. defense supply chains.

Recent events underscore this risk. In April 2025, the Chinese government announced strict export controls targeting seven key REEs commonly used in defense systems. This followed earlier restrictions on other critical minerals. Such actions demonstrate how control over REE supply can become a geopolitical tool. They potentially allow China to disrupt U.S. defense production or influence international affairs. Reflecting this reality, NATO now officially recognizes the security threats posed by reliance on China for critical materials like REEs. Ensuring access to rare earths is no longer just an economic concern; it is a strategic imperative for national defense.

Overview of global REE demand and supply

Global demand for Rare Earth Elements is surging in 2025. This intense demand stems from three main areas: high-technology consumer goods, the transition to clean energy, and advanced defense systems. The size of the global REE market shows this growth. Valued near $3.9 billion in 2022, projections suggest it could expand to $9.6 billion by 2030, or perhaps even $14.7 billion by 2032.

The shift toward electric vehicles (EVs) represents a major driver. Powerful REE magnets form the heart of many EV motors. EVs might account for 40 percent of all REE demand by the year 2040. Sales of battery electric cars jumped 35 percent in 2023 alone. Renewable energy technologies, especially wind turbines, also require large amounts of REEs for their generators. The European Union forecasts that REE demand for wind power could increase 5.5 times by 2050. Demand for certain individual REEs, like dysprosium used in high-performance magnets, faces potential supply shortfalls. Experts predict a possible 2,823-ton gap between dysprosium supply and demand by 2034, potentially causing prices to increase 340 percent.

On the supply side, global mines produced roughly 350,000 tonnes of REEs in 2023, increasing to 390,000 tonnes in 2024. China leads global production by a wide margin. It mined 270,000 tonnes in 2024, about 70 percent of the world's total. China's control over refining stands at over 90 percent, giving it a powerful position in the middle of the supply chain.

The United States contributes a smaller portion of mined supply. The Mountain Pass mine in California produced 45,000 tonnes in 2024. This amounts to roughly 12 to 15 percent of global mine output. However, the U.S. currently lacks sufficient domestic capacity to process this mined material into finished metals, so much of it is shipped to China for refining.

Other countries add to the global mining total. Myanmar produced 31,000 tonnes in 2024, although its mining sector faces challenges related to conflict and environmental practices. Australia mined 13,000 tonnes, and Nigeria increased its production significantly to 13,000 tonnes. India possesses the world's fifth-largest REE reserves (6.9 million tonnes) but currently accounts for only 1 percent of global production. Nations across Africa, Latin America, and Asia explore ways to boost their REE output. Africa, for instance, has a goal to supply 10 percent of global REE needs by 2030.

Expanding and diversifying the global REE supply chain faces significant obstacles. These include the environmental impact of mining, political instability in some resource-rich areas, and the high capital costs for new mines and refineries. Furthermore, recycling of REEs remains very low, recovering less than 5 percent of elements from end-of-life products. Balancing the surging demand with a secure, sustainable, and geographically diverse supply is a critical global challenge today.

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Table of Contents

(Click on any section to start reading it)

1. Introduction: The Strategic Significance of Rare Earths

• What Are Rare Earth Elements (REEs)?

  • Definition and classification of REEs

  • Unique properties and applications

• Historical Context

  • Evolution of REE usage in technology and defense

  • Past supply chain challenges and lessons learned

• Current Relevance

  • Why REEs are critical to modern national security

  • Overview of global REE demand and supply​

2. Military and Technological Dependence on Rare Earths

• Defense Applications

  • Use of REEs in fighter jets, missile systems, and naval vessels

  • Importance in communication and surveillance equipment

• Advanced Technologies

  • Role in emerging technologies like hypersonics and directed energy weapons

  • Integration in AI and quantum computing hardware

• Civil-Military Integration

  • Overlap between civilian and military REE applications

  • Implications for supply chain security​

3. Global Supply Chains and Geopolitical Dynamics

• China's Dominance

  • Extent of China's control over REE mining and processing

  • Strategies employed by China to maintain dominance

• Supply Chain Vulnerabilities

  • Risks associated with concentrated supply sources

  • Impact of export restrictions and trade disputes

• International Responses

  • Efforts by the U.S. and allies to diversify supply

  • Collaborations and partnerships to secure REE access

4. U.S. Strategies for Securing Rare Earth Supplies

• Domestic Initiatives

  • Investment in domestic mining and processing facilities

  • Legislative measures to promote REE independence

• Stockpiling and Reserves

  • Development of strategic reserves for critical minerals

  • Policies under the Strategic and Critical Materials Stock Piling Act

• Research and Development

  • Funding for alternative materials and recycling technologies

  • Support for innovation in REE extraction and processing

5. Economic and Environmental Considerations

• Market Dynamics

  • Price volatility and its effects on industry

  • Economic implications of supply disruptions

• Environmental Impact

  • Challenges in environmentally sustainable REE extraction

  • Regulatory frameworks governing mining activities

• Balancing Security and Sustainability

  • Strategies to reconcile national security needs with environmental concerns

  • Role of recycling and circular economy approaches​

6. Future Outlook and Policy Recommendations

• Emerging Technologies and REE Demand

  • Projected growth in REE requirements for future tech

  • Potential for new materials to reduce dependence

• Policy Frameworks

  • Recommendations for U.S. policy to enhance REE security

  • Importance of international cooperation and alliances

Baked with love,

Anna Eisenberg ❤️