Informist, Monday, Jul. 7, 2025

NEW DELHI – China's dominance over the global rare earth elements supply chain is facing increasing pressure as countries try to diversify sources and reduce strategic dependence, CareEdge Global said in a report. Though China controls 69% mining and 90% refining of global rare earth elements, its market share is expected to decline by 2030 amid rising supply chain diversification. 

According to the International Energy Agency's projections, China's share of rare earth elements mining is likely to drop to 51% from current 69% and that of refining is seen falling to 76% from 90% by 2030. Rare earth elements, comprising 17 minerals vital to green energy, defence, and electronics, have become integral to geopolitical and economic power.

China's supremacy is not just over-abundant reserves, but stems from decades of state-backed investment, low environmental standards, and near-total control of the refining infrastructure, the report said. Its strategic use of export restrictions, such as bans on gallium and germanium in 2024, and more recently, restrictions on heavy rare earth elements, have highlighted the vulnerability of the global supply chain.   

However, rising concerns over supply disruptions have prompted major economies like the US, India, and the European Union to strengthen domestic capabilities and make new partnerships. The US, which holds just 2.1% of global rare earth element reserves, is aggressively rebuilding its domestic supply chain. Despite its modest resource base, the US accounts for 12% of rare earths global mining output, second to China.

Additionally, with investments of over $439 million since 2020, the US is exploring new mining and processing projects in Alaska and Wyoming. However, refining remains weak as most US mined ore is still being shipped to China for processing, the report said. 

Meanwhile, India holds 8% of global reserves of rare earth elements, but contributes less than 1% to production. The country launched its National Critical Mineral Mission to boost domestic extraction and manufacturing. With coastal states like Tamil Nadu and Odisha rich in rare earth element deposits, India is also mulling export restrictions and incentives to scale up domestic refining, the report said.

Meanwhile, Brazil is home to 23% of global reserves and has entered the commercial landscape with the Serra Verde mine, with investments from both the US and the UK. Australia is rapidly expanding production capacity with strong US investments in the country, the report said. Despite rising investments, global alternatives are yet to reach the scale needed to fully displace China's role in the rare earth element supply chain, the report said.  End

US$1 = INR 85.85

Reported by Afra Abubacker

Edited by Tanima Banerjee

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.