Rare earths get federal backing — and tech advances : NPR

With names like neodymium and dysprosium, rare earth elements sound exotic, and their perceived rarity only adds to the mystique.

In reality, rare earth elements are not that rare, they are just difficult to mine and refine. Yet they have become essential to modern life, built into everything from our smartphones and electric vehicle engines to wind turbines and medical imaging devices.

And demand is growing.

The real bottleneck is recycling and purification, a complex and environmentally sensitive step in which the US lags and which China now dominates, controlling almost 90% world production.

The need for compact, high-torque electric motors that use rare-earth magnets that are three to four times stronger than conventional magnets is helping drive demand. The production of these engines is growing rapidly. about a third every year. Military aircraft also rely heavily on these elements; one RAND The F-35 is estimated to contain more than 900 pounds of rare earth materials in its engines and electronics.

Public-private approach

To reduce dependence on foreign supplies, the White House is pushing for U.S. self-sufficiency in rare earth production. The federal government under President Trump has supported the sector in ways that depart from traditional free market principles. Instead of relying solely on private industry, the federal government is following a strategy similar to China's, providing hundreds of millions in loans and even acquiring stakes in key mines and startups.

Indiana-based ReElement Technologies is among the beneficiaries of this government support. Earlier this month, the Trump administration announced a partnership between the Pentagon through its Strategic Capital Management (OSC), ReElement and Vulcan Elements, a North Carolina firm that produces rare earth magnets for military applications.

ReElement says it has developed a more efficient and environmentally friendly method for processing and recycling rare earth elements, involving chromatography. The company operates a commercialization facility in Noblesville, Indiana, as well as a larger manufacturing facility in Marion, Indiana, scheduled to come online next year.

ReElement Technologies CEO Mark Jensen confidently states that by the end of 2026, “we will be the largest producer of rare earth oxides in the United States.”

Because China's dominance in oil refining is so strong, U.S. success rates are modest, according to Bert Donnes, a research analyst at the investment banking firm William Blair.

ReElement, in partnership with Vulcan Elements, plans to produce 10,000 metric tons of neodymium-iron-boron magnets over the next few years, used not only in electric vehicles, but also in wind generators, hard drives and MRI machines. According to Institute of Electrical and Electronics Engineersor IEEE.

“I would say if you see those numbers, you think it's going to be a huge facility,” Donnes says of ReElement's current operations. “This is wrong”.

Compared to a traditional processing plant, ReElement operates in a compact manner, which helps avoid the not-in-my-backyard (NIMBY) backlash, he said. “So people are not afraid of this process. They might not know that much about it because you can make the process so small,” he says.

How the US lost its leadership

Since the 1980s, China began to rush forward USA and the rest of the world in the production of rare earth elements. Around the same time, environmental problems were intensifying at the only major rare earth mine in the United States, Mountain Pass in California, where spills of radioactive and toxic wastewater—byproducts of processing—raised alarm.

According to Kelton Smith, lead mining technologist at Tetra Tech, a global consulting and engineering firm, Mountain Pass is an open-pit mine that “drills and blasts, mixes their types and locations in the pit,” and then grinds solid materials into smaller particles. The flotation process then concentrates the rare earth elements, which in turn are leached by hydrochloric acid.

Over the years, the California mine has had to shut down production several times due to environmental concerns. During this time, it changed hands and eventually filed for bankruptcy protection before being acquired by MP Materials in 2017, which reopened the mine.

Trouble in Mountain Pass helped China gain a foothold and eventually overtake the United States in rare earths – just as demand for them was rising. Beijing now produces about 60% of the world's supply of these substances, according to International Energy Agency. China also holds a significant amount of the world's proven reserves of ores containing these elements—approximately 34%—but several other countries, including the United States, also have significant reserves, according to the US Geological Survey.

Trump's trade war with China has further exacerbated the shortage of rare earth metals. Because the United States does not have the ability to process rare earth elements on a large scale, MP Materials had to ship ore from Mountain Pass to China for processing. But no more. Instead, the company must expand its limited capacity to process ore on site.

Further complicating the problem are extended export controls Beijing announced last month which require foreign companies to obtain a license to sell overseas products containing rare earth elements of Chinese origin.

Aaron Mintzes is associate director of policy and advisor to Earthworks, a national group dedicated to preventing the adverse impacts of mineral and energy development. “We encourage… these treatments to be done in a way that reduces energy and water consumption and toxicity,” he says.

Brent Elliott, an assistant professor of geology at the University of Texas, said the U.S. has enough resources to meet demand. “It's about the potential of extraction and the logistics of getting it out of the ground in a way that is environmentally sensitive but also socially responsible,” he says.

Partly because it is an environmentally dirty project with toxic byproducts, Beijing has gained an advantage by ignoring these consequences. “China can do it faster and better because they don’t have the same environmental problems that we do,” Elliott says.

Many experts agree that the US has enough reserves, but lacks refining capacity. Simon Jowitt, a geologist and director of the Nevada Bureau of Mines and Geology, says there are a number of rare earth deposits in the U.S. that have potential, but it's rarely a simple statement.

“You need a source of rare earths, some way of transporting the rare earths, some way of concentrating them, and some way of getting those rare earths into a form in which they can then be extracted,” says Jowitt. “If you don't have any of those, then you'll end up with something that isn't a mineral deposit, and you'll never get anything out of it.”

Last year China decided new rules for processing rare earth elements, which involve strict environmental and safety regulations, but it remains to be seen how stringent compliance with these regulations will be.

Meanwhile, the company not only processes its own ore, but also imports raw ore from places such as Southeast Asia and Africa. It's part of China's broader strategy to transform itself into a global hub for rare earth metals, according to Gracelyn Baskaran, director of the Critical Minerals Security Program at the Center for Strategic and International Studies.

“They put a lot of government resources into setting up processing facilities, so the minerals come from different places and then go to China for processing,” says Baskaran. “What China is extraordinarily good at is integrating its foreign policy with sourcing rare earth metals from around the world.”

New process and federal investment

ReElement comes to the rescue in oil refining. The company uses large columns in a specialized filtration process developed at Purdue University to extract and purify valuable metals from raw ore, as well as recycled rare earth metals from old magnets. The process is more efficient and less harmful to the environment than older methods, such as those used in China.

Jensen, ReElement's CEO, says the method, known as solvent extraction, is “environmentally challenging” and difficult to scale. “It's a dead technology,” he says, adding that his company's ultimate goal is not necessarily U.S. dominance, but to produce enough rare earths domestically to break China's monopoly.

The “One Big Beautiful” bill was adopted in July allocated $7.5 billion. towards securing critical minerals. A few days later, the Pentagon's Office of Strategic Capital announced $400 million investment in MP Materialsmaking the US government the company's largest shareholder. Pentagon agency plans further investments in “[c]critical components, raw materials and rare earth elements used in microelectronics manufacturing.”

As part of the ReElement deal, Vulcan Elements will receive a $620 million loan from the Pentagon's OSC, as well as an additional $50 million provided by the Department of Commerce as part of the ReElement deal. CHIPS and Science Law signed by former President Joe Biden. ReElement Technologies will receive an $80 million loan to support the expansion of its waste and recycling operations.

“I think we're making great strides right now with all the grants that are coming in and the grants that are focused on critical minerals,” says Elliott, a geology professor at the University of Texas. “I think this can really set us up for success.”