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Recently, a top US official returned from South Carolina brandishing a small piece of metal, declaring it was the first rare-earth magnet manufactured in the US in 25 years.

He indicated that this was proof the US is breaking “Beijing's grip on our supply chain.” Because of a new rare-earth mineral manufacturing plant in the state, he added, “We’re finally becoming independent again.”

Challenging Beijing's Control in Essential Minerals

Ending Beijing's processing and manufacturing dominance in these materials, which are crucial for advanced electronics, energy storage, and military equipment, is a major focus for the American leadership. Through tariffs and other strategies, the US is betting on bringing the industry home to American shores.

Such measures prompted Beijing to limit rare-earth shipments to the US and motivated US leaders to sign deals with an ally, Malaysia, Cambodia, and Japan.

Although the US and China have since brokered a temporary agreement on rare earths, China—with approximately 70% of worldwide extraction and over 90% of international refining—has a head start that may prove challenging to erode.

“Rare earths are used in EV engines but also in guidance systems that have obvious applications 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 minerals critical to national security, chip manufacturing, and the transition from traditional energy to renewable sources. According to official sources, the US brought in 80% of the rare earths it consumed in 2024.

In the case of rare-earth minerals such as a key element, used in chip production, and another mineral, essential to defense systems, Chinese refinement dominance rises to 99%. Dysprosium and terbium are used in magnets essential for electric engines and generators in wind turbines, along with applications for cellphones, high-intensity lighting, and nuclear reactors.

Extended Timelines and Global Deposits

Efforts to cut the US’s reliance 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 earth’s crust, but many reserves, such as those in Ukraine, where an agreement was signed earlier this year, are only in the early stages of mining.

“It’s not that there’s a shortage per se, it’s that China can limit how much is sent abroad,” an analyst explained, adding that obtaining permits from China can be a complex and time-consuming endeavor.

Greenland, another focus of American interest, and Brazil, are additional nations with substantial rare-earth deposits. Domestically, there are deposits in California, the Midwest, and Missouri, with the largest operational mine operating at Mountain Pass, California, about 60 miles from Las Vegas.

Government Initiatives and Investment

In July, the US Department of Defense became the major investor in an industry operator, with plans to open a new “mine-to-magnet” plant, named 10X, to make magnets crucial for military aircraft, drones, and naval vessels.

Across the continent, estimated reserves of rare earths were estimated to include millions of tons in the US and additional millions in Canada—significantly lower than the 44m tons believed to be in China.

Following government funding in other sectors and US chipmakers, the interior department announced it was prepared to make direct investments in strategic resource firms.

“The US is up against state capital because China is selecting these as priority areas that they aim to control,” a cabinet member stated during a address in April.

The official suggested that the US could use a national investment pool to accelerate production. “How could the wealthiest country in the world have the largest sovereign wealth fund?” he questioned.

Past Challenges and Future Outlook

American attempts to support domestic production have floundered in the past when Chinese producers lowered prices, making unsubsidized rare-earth development unprofitable against Asia's competitive pricing and far-sighted planning.

In the past, an industry leader testified before a US Senate committee that “those who invest in energy storage and supply chains now are likely to dominate this sector for the foreseeable future. It is not too late for the US but action is needed now.”

Since then, a race to assemble international partnerships around rare earths is accelerating.

“In about a year from now, we’ll have so much essential resources that supply will exceed demand,” the President informed the media. This followed in the wake of a demand for compensation in the form of minerals from Ukraine. More recently, the government of Pakistan agreed to a contract with an American company, securing rights to minerals such as key metals.

Can the US Succeed?

However, can the US make up its gap and weaken China’s hold on rare-earth supply chains? “America has implemented major measures already,” a specialist comments. The US, he adds, is unlikely to become “self-reliant in the short term because it takes time to start operations and establish processing plants.”