EL7.AI
Geopolitics•15 November 2026•
4 min read

The US Will Remain Reliant on China for Rare Earths Through Much of the 2030s

Key Facts

1The United States will not shed its reliance on China for rare earth elements through much of the 2030s despite expanding domestic mining and processing.
2US production covers 42% of demand for the two most common types, and the country will still import about a quarter in five years.
3US demand for the most common type of rare earth magnet reached 48,000 metric tons in 2025, compared with 300 metric tons domestically.
4Full implementation of China’s expanded controls could put $6.5 trillion a year in downstream industrial production outside China at risk.

The United States will remain reliant on China for rare earth elements through much of the 2030s, despite a faster buildout of domestic mining and processing capacity, according to a Reuters analysis. That puts the supply gap at the forefront of the minerals agenda ahead of expected talks between US President Donald Trump and Chinese President Xi Jinping. Data cited by the agency show US production covers only 42% of demand for the two most common types of rare earth elements. Even in five years, the United States will still import about a quarter of its needs for the two types. The figures show that expanding domestic production does not quickly translate into supply independence.

The gap is more pronounced in magnets made from rare earth elements, an industrial input underpinning US demand. Demand for the most common type reached about 48,000 metric tons in 2025, while supplies from domestic sources amounted to no more than 300 metric tons, according to data cited by Reuters. US companies were targeting production capacity of 5,000 metric tons by the end of 2026. Even if that capacity is achieved, it would remain below the level of demand recorded in 2025. The gap reflects the distance between announcing new projects and their ability to supply volumes matching market needs.

The issue is not limited to mining, as control is also concentrated in refining and processing. Reuters reported that China controls more than 80% of the metals refining sector, while the International Energy Agency said the largest supplier’s share of rare earth refining fell from more than 90% in 2023 to 85% in 2025. The agency expects that share to decline to 70% by 2035 if planned projects enter service on schedule. The agency said that “new projects in the United States and production increases in Malaysia” had reduced the largest supplier’s share. The projected path remains conditional on those projects being delivered, while the figures show that diversification has begun but has not ended the concentration.

Plans to build an integrated supply chain face another bottleneck in converting metals into magnets. The International Energy Agency estimates that existing and announced refining capacity in geographically diverse regions is equivalent to about two-thirds of projected rare earth mine production by 2035. Magnet production plans, by contrast, represent only one-third of that projected output. The agency said that “magnet production plans account for only one-third.” The gap between raw materials, processing and the finished product means that increased mineral extraction alone is not enough to meet demand for manufactured components. Downstream manufacturing capacity therefore remains a crucial part of efforts to reduce reliance on the dominant supplier.

This vulnerability has a commercial dimension as Chinese restrictions on mineral exports continue. The International Energy Agency estimated that full implementation of China’s expanded controls on rare earth elements could put about $6.5 trillion a year in downstream industrial production outside China at risk. Beijing had suspended implementation of those measures for one year, until November 2026, but the agency said that “vulnerabilities remain.” The agency also warned that export restrictions could threaten global manufacturing on this scale. In markets, prices for minor strategic metals more than doubled during 2025 and early 2026, while tungsten prices rose sixfold; gallium and heavy rare earth prices in Europe also reached about five times domestic Chinese prices.

US moves are part of a broader effort to address declining domestic production amid rising demand. The White House said in January 2026 that “US production of critical minerals was declining despite rising demand,” and directed negotiations with trading partners on imports of processed critical minerals and their derivatives. The US Department of Energy also cited the Geological Survey as saying that more than 95% of the country’s rare earth supplies come from foreign sources. These figures show the scale of dependence targeted by US trade and industrial policy, alongside the development of mines and processing facilities. In the near term, the annual Association of Southeast Asian Nations summit begins in Manila on Sunday, with leaders’ talks lasting three days, according to the Associated Press. Trump is expected to arrive in Manila on Tuesday before traveling to Shenzhen for the APEC summit and a meeting with Xi Jinping.