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Recently, a top US official came back from South Carolina holding up a tiny sample of metal, declaring it was the initial rare-earth magnet manufactured in the US in 25 years.

He indicated that this was a sign the US is overcoming “China’s chokehold on our industrial pipeline.” Due to a recently opened rare-earth mineral refining facility in South Carolina, the official continued, “The nation is regaining its autonomy.”

Countering Beijing's Control in Critical Materials

Reducing Beijing's refining and production supremacy in these materials, which are crucial for some semiconductors, batteries, and military equipment, is a key goal for the American leadership. Via trade measures and other approaches, the US is counting on returning the industry back to American shores.

These tariffs led China to limit rare-earth shipments to the US and pushed US leaders to sign deals with an ally, Malaysia, Cambodia, and Japan.

Although the US and China have now brokered a temporary agreement on rare earths, Beijing—with approximately the majority of global mining and over 90% of international refining—has a head start that may prove challenging to overcome.

“Rare earths are used in EV engines but also in defense technology that have clear uses for the military,” notes an industry expert. “Any device that has a decent magnet in it uses rare earths.”

No Easy Fix for American Self-Sufficiency

There’s no easy fix for the US to reset its dependence on imports from China of materials critical to national security, chip manufacturing, and the shift from fossil fuels to wind and solar. According to official sources, the US imported 80% of the rare earths it used in recent years.

In the case of rare-earth minerals such as a key element, essential for semiconductors, and samarium, critical for military applications, Chinese refinement dominance rises to almost total. These elements are used in magnets crucial to electric engines and generators in renewable energy, along with uses in cellphones, advanced lighting, and energy plants.

Extended Timelines and International Resources

Efforts to cut the US’s dependence on Chinese production of rare-earth minerals may require a long time. Experts note that “These minerals” is somewhat of a misnomer because they’re not that uncommon in the planet's surface, but many deposits, such as those in Ukraine, where an agreement was signed recently, are only in the early stages of extraction.

“The issue isn't scarcity per se, it’s that Beijing can control how much is sent abroad,” an analyst explained, noting that obtaining export licenses from China can be a lengthy, difficult process.

Greenland, a key area of US attention, and Brazil, are two other countries with substantial rare-earth resources. Domestically, there are reserves in the West, the Midwest, and Missouri, with the biggest active site located at Mountain Pass, California, not far from a major city.

Federal Efforts and Funding

Recently, the US Department of Defense took on the role of the largest shareholder in an industry operator, with plans to open a new “mine-to-magnet” plant, called a new facility, to produce magnets essential for military aircraft, unmanned systems, and submarines.

Across the continent, estimated reserves of rare earths were estimated to include 3.6m tons in the US and more than 14m tons in the northern neighbor—significantly lower than the vast reserves believed to be in China.

Following direct investment in other sectors and US chipmakers, the federal agency announced it was ready to make direct investments in strategic resource firms.

“The US is up against state capital because Beijing is selecting these strategically that they aim to control,” a senior official said during a address in April.

He suggested that the US could use a sovereign wealth fund to speed production. “How could the wealthiest country in the world not possess the largest sovereign wealth fund?” he asked.

Historical Obstacles and Future Outlook

American attempts to support homegrown output have floundered in the past when Chinese producers cut costs, making unsubsidized rare-earth development uneconomic against China’s lower cost of production and long-term strategic outlook.

In the past, a market expert testified before a US Senate committee that “nations that fund in energy storage and supply chains now are poised to lead this sector for generations to come. It is not too late for the US but immediate steps are required.”

Five years on, a scramble to build trading alliances around rare earths is accelerating.

“Soon, we’ll have so much essential resources that supply will exceed demand,” a top leader informed reporters. That came eight months after a demand for payment in the form of minerals from Ukraine. More recently, the authorities in Asia signed a deal with an American company, giving it access to minerals such as antimony and copper.

Prospects for Success

But, is America able to close its gap and weaken Beijing's grip on rare-earth global networks? “America has implemented really significant steps so far,” an analyst comments. The nation, he adds, is unlikely to become “independent in the short term because it requires years to start operations and build refining capacity.”