Global rare earth supply chains are undergoing a realignment, with the diversification of permanent magnet production used in products such as electric vehicles, wind turbines, and drones, aiming to break China’s industry monopoly.
Rare earth processing is mainly divided into two stages. The first stage involves extracting rare earth from ores containing other minerals and concentrating them into mixed rare earth concentrates or carbonates. The second stage is more complex, requiring the separation of rare earth into individual oxides before being transformed into metals for magnet production.
According to Reuters, the following companies have either established or are constructing rare earth compound, metal, and magnet production facilities to reduce Western reliance on almost entirely importing from China.
Lynas Rare Earth, based outside of China, is the world’s largest supplier of rare earth compounds, with its mine located at Mount Weld in Australia. The company operates processing facilities in Australia and Malaysia and is in the process of constructing a heavy rare earth processing plant in Texas, USA, funded with $288 million from the US Department of Defense, expected to be operational in the 2026 fiscal year.
Belgian chemical manufacturer Solvay is expanding its rare earth processing capacity at its La Rochelle plant in France with the aim of starting the separation and production of rare earth oxides necessary for permanent magnet production by 2025. In addition, Solvay has signed agreements with French rare earth partner Carester to explore manufacturing opportunities for a European permanent magnet supply chain and with Canadian clean technology startup Cyclic Materials to purchase rare earth oxides from recycled materials.
Headquartered in France, the goal of the Castech Group is to annually recover 2,000 tons of magnets starting from 2026 and also to separate 5,000 tons of heavy rare earth concentrates from mining.
German company Vacuumschmelze is one of the largest permanent magnet producers outside of China, with production facilities in Germany, Slovakia, Finland, China, and Malaysia. In October last year, the company was acquired by US private equity firm Ara Partners. It received $111.6 million in US government funding to construct a neodymium iron boron magnet plant in South Carolina, expected to be completed by the end of 2025.
The company has signed a magnet supply agreement with General Motors and supplies to the US Department of Defense.
Based in the UK, Less Common Metals produces rare earth metals/alloys at its site in northern England, as part of the European Supreemo project aiming to establish a European rare earth value chain.
REEtec in Norway is constructing a commercial rare earth separation plant with the support of Swedish mining company LKAB, expected to begin operations in 2025. The company is in discussions with several companies for the supply of concentrates to the plant.
Australian mineral sands producer Iluka Resources is constructing the Eneabba rare earth refining plant in the northwest of the country, processing heavy rare earths from its own mines and third parties like Northern Minerals. Expected to be operational by the end of 2026, Iluka has secured a $1 billion Australian dollar ($660 million USD) loan from the Australian government for this project, which will be Australia’s first fully integrated rare earth refining plant.
Posco International from South Korea will supply permanent magnets produced by Star Group from 2025 to German and American automakers. These magnets are sourced from the US, Australia, and Vietnam. Privately held Star Group is the exclusive producer of rare earth permanent magnets in South Korea.
Japan holds a developed magnet market supplying its domestic automotive and high-tech industries. Major producers include Shin-Etsu Chemical, TDK Corporation, and Proterial (formerly Hitachi Metals).
Vietnamese rare earth processor VTRE has signed a partnership agreement with Australian rare earth developer Blackstone Minerals and Australian Strategic Materials. The company halted production at the end of last year after its chairman was arrested for violating mining regulations.
Listed in Toronto, Neo Performance Materials manufactures rare earth oxides, magnetic powders, and permanent magnets. The company has factories worldwide, including in China, the US, Germany, Canada, Thailand, and the UK. There are plans to build a permanent magnet factory in Estonia next year.
The Saskatchewan Research Council in Canada received CA$31 million ($22.57 million USD) in government funding to construct a rare earth processing plant. The company has signed a supply agreement with Vietnam’s Hung Thinh Group, importing up to 3,000 tons of rare earth carbonate annually starting from June 2025 for five years.
Ucore Rare Metals in Canada is constructing a light and heavy rare earth separation facility in Louisiana, USA, expected to be operational by the end of 2025.
Rainbow Rare Earths, supported by Dublin-based private investment firm TechMet, has begun rare earth oxide separation processes at its K-Technologies plant in Florida, with the goal of producing rare earth carbonates from its Phalaborwa project in South Africa.
MP Materials is constructing a rare earth magnet production plant in Texas, USA, with $58.5 million in government funding. The company currently ships rare earth concentrates to China but plans to produce finished magnets by the end of 2025 for supply to General Motors. The company faced larger-than-expected losses in the first quarter due to weak rare earth prices.
Energy Fuels is a US producer of uranium and rare earth elements. The company announced on June 10 that it had begun commercial-scale rare earth separation at its Utah plant, with the ability to produce up to 1,000 tons of neodymium and praseodymium annually.
The Federation of Industries of Minas Gerais in Brazil is constructing a proof-of-concept magnet plant, expected to start operating in the second half of this year, capable of producing 100 tons of magnets annually at full capacity.
Brazil ranks third in the world in rare earth reserves. With the surging demand for magnets from electric vehicles and green energy, Brazil is keen to develop its rare earth industry. Western governments are providing incentives to this global mining powerhouse to break China’s monopoly in the rare earth production sector.
According to Reuters, Brazil’s first rare earth mine, Serre Verde, started commercial production this year.
Analyst Reg Spencer from broker Canaccord stated that by 2030, Brazil could potentially have two to three more rare earth mines, surpassing Australia’s current annual output.