What are rare earth minerals?

China added five rare earth elements to its existing export control list in early October. During meeting with President Donald Trump on Oct. 30, Chinese President Xi Jinping agreed to delay the new restrictions for at least one year, but the measures have the potential to seriously disrupt the global economy. The United States relies on China to supply about 70% of its rare earth metal imports. Many technologies wouldn’t exist without them, including smartphones, electric vehicles, missile guidance systems, and some cancer therapies.

What are rare earth minerals, and are they actually rare? Rare earth minerals contain one or more of the 17 rare earth metallic elements. These metals, which include the 15 lanthanides as well as scandium and yttrium, possess unique magnetic, luminescent, and electrochemical properties. They are not rare in terms of natural occurrence—for example the Earth’s crust has more cerium than copper. But they are rare in terms of availability. Rare earths are seldom discovered in concentrated, economically viable forms, making for a costly extraction and purification process.

Why are rare earth elements so important? These metals are critical to key sectors of the U.S. and global economies because of their unique chemical and physical properties. Neodymium magnets, for example, are essential to clean energy technologies, while yttrium is critical to LED lighting and cancer therapies. U.S. military equipment, including F-35 fighter jets and the Virginia-class submarine, requires thousands of pounds of rare earth elements.

How did China monopolize the rare earths industry? China took over the rare earths market in the mid-1990s when U.S. companies began offshoring their processing to China, a regulatory wild west, in response to increased environmental restrictions at home. Chinese executives, who had toured Molycorp rare earths processing company in Mountain Pass, Calif., stole and improved upon U.S. technology. Cheap labor and heavy government subsidization also boosted China’s rare earth metals output. The country now controls over 90% of global refining and about 60% of global production.

Can’t we replace rare earth elements with something else? Geopolitical pressures have already spurred a search for alternatives, but it’s difficult to find economically viable replacements that match rare earth’s special properties. Ferrite magnets are a promising substitute due to their corrosion resistance and affordability, but rare earth magnets have up to 10 times the magnetic strength. Some companies developed technologies to reduce or even eliminate their rare earth use. Toyota designed a neodymium-reduced magnet, while BMW’s fifth-generation electric motors are rare-earth-free.

Is the U.S. taking steps to rebuild its rare earths industry? Yes. In July the War Department invested $400 million in MP Materials, which owns and operates the Mountain Pass mine. Nebraska-based NioCorp’s Elk Creek project, the first and only U.S. site for mining and processing niobium, received $10 million in funding from the Pentagon in August. Vulcan Elements, a startup rare earths manufacturer in North Carolina, was awarded over $10 million across nine Department of War contracts this year.