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Recently, a top US official returned from South Carolina displaying a tiny sample of metal, declaring it was the initial rare-earth magnet made in the US in 25 years.

He indicated that this was evidence the US is breaking “China's dominance on our industrial pipeline.” Thanks to a new rare-earth mineral refining facility in South Carolina, he added, “The nation is regaining its autonomy.”

Breaking Beijing's Control in Critical Materials

Overthrowing Beijing's processing and manufacturing dominance in these materials, which are vital for some semiconductors, energy storage, and armaments, is a key goal for the federal government. Through trade measures and other approaches, the US is relying on bringing the industry home to domestic facilities.

Such tariffs prompted China to limit rare-earth shipments to the US and pushed the administration to forge agreements with Australia, Malaysia, Cambodia, and Japan.

While the US and China have now brokered a temporary agreement on rare earths, China—with approximately the majority of global mining and nearly all of global processing capacity—holds an advantage that may prove challenging to erode.

“These materials are used in electric motors but also in defense technology that have clear uses for the military,” notes an industry expert. “Any device that has a strong magnet in it uses rare earths.”

No Easy Fix for US Independence

There’s no easy fix for the US to reduce its dependence on Chinese production of materials essential to defense, semiconductor production, and the transition from traditional energy to wind and solar. According to federal reports, the US imported 80% of the rare earths it used in 2024.

In the case of rare-earth minerals such as dysprosium, essential for chip production, and samarium, critical for military applications, Chinese refinement dominance rises to almost total. These elements are used in magnets crucial to electric engines and generators in wind turbines, along with uses in mobile devices, advanced lighting, and nuclear reactors.

Extended Timelines and Global Deposits

Efforts to reduce the US’s reliance on China's output of rare-earth minerals may require a long time. Experts note that “Rare earths” is somewhat of a misnomer because they’re relatively abundant in the planet's surface, but many deposits, such as those in Eastern Europe, where a deal was signed recently, are only in the initial phases of mining.

“The issue isn't scarcity per se, it’s that China can control how much is sent abroad,” a specialist said, noting that securing export licenses from China can be a complex and time-consuming endeavor.

Greenland, a key area of American interest, and South America, are two other countries with significant rare-earth deposits. Domestically, there are deposits in the West, the Midwest, and the central US, with the largest operational mine operating at Mountain Pass, California, not far from a major city.

Federal Efforts and Investment

In July, the US Department of Defense became the largest shareholder in a mining company, with intentions to open a new “integrated” plant, named a new facility, to produce magnets essential for F-35 fighter jets, drones, and submarines.

In North America, estimated reserves of rare earths were calculated at millions of tons in the US and more than 14m tons in the northern neighbor—far less than the vast reserves estimated to be in China.

Mirroring government funding in other sectors and US chipmakers, the interior department said it was ready to make direct investments in critical mineral companies.

“The US is up against state capital because Beijing is selecting these strategically that they aim to control,” a cabinet member stated during a address this spring.

The official suggested that the US could utilize a national investment pool to speed production. “Why wouldn’t the richest nation in the world not possess the biggest sovereign wealth fund?” he asked.

Historical Obstacles and Future Outlook

American attempts to promote homegrown output have struggled in the past when Chinese producers lowered prices, rendering unsubsidized rare-earth development uneconomic against China’s lower cost of production and long-term strategic outlook.

In the past, an industry leader stated before a US Senate committee that “nations that fund in battery capacity and industrial networks now are poised to lead this industry for the foreseeable future. It is not too late for the US but immediate steps are required.”

Since then, a scramble to build international partnerships around rare earths is accelerating.

“In about a year from now, we’ll have an abundance of critical mineral and rare earths that you won’t know what to do with them,” a top leader informed reporters. That came in the wake of a request for payment in the form of natural resources from another country. In September, the authorities in Asia signed a contract with an American company, securing rights to minerals such as antimony and copper.

Can the US Succeed?

But, can the US make up its shortfall and loosen China’s hold on rare-earth supply chains? “America has implemented really significant steps already,” an analyst comments. The nation, he adds, cannot be “self-reliant in the near future because it requires years to bring a mine online and build refining capacity.”