China produces 90% of refined rare earths, while West tries to secure own supply
Western governments have made strides in securing their own supply of rare earths, but there is still more work to do, said Luisa Moreno, director at Defense Metals. China has an outsized importance in the rare earth market globally. According to the United States Geological Survey, China accounts for 70% of rare earths mining. It also has 90% of refined output.
Rare earths are designated as critical minerals, and Western countries have been trying to secure their own supply. In March MP Materials awarded $58.5 million tax credit for Texas rare earth magnet factory. MP Materials owns and operates the Mountain Pass mine, the only operating rare earth mine and processing facility in the United States. Also in March the Australian government announced A$550 million funding for the Arafura rare earths project in the Northern Territory.
These investments and others like it are starting to make a difference, said Moreno.
“[It] is important to start developing…a supply chain outside of Asia, but there’s more work to do,” said Moreno, who warned that the industry could be imperiled by low metal prices.
Rare earth prices have been under pressure. According to Reuters, the price in China of praseodymium oxide, a rare earth benchmark, fell by a third in 2023.
Moreno pointed to Indonesia, which has been flooding the market with cheap nickel after big investments in mining and processing from China. “We’ve seen what has happened with nickel in Indonesia. The price of nickel has collapsed, which has resulted in mine closures,” said Moreno.
Defense Metals is advancing a rare earth project near the center of British Columbia. The Wicheeda project is 80 km from Prince George. The project has measured mineral resource of 6.4 million tonne, averaging 2.86% total rare earth oxide (TREO); indicated mineral indicated resource of 27.8 million tonne, averaging 1.84% TREO; and an inferred mineral resource of 11.1 million tonne, averaging 1.02% TREO, reported at a cut-off grade of 0.5% TREO.
