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Last week, the US Treasury Secretary returned from South Carolina displaying a small piece of metal, proclaiming it was the first rare-earth magnet manufactured in the US in decades.

He indicated that this was proof the US is ending “Beijing's grip on our supply chain.” Because of a recently opened rare-earth mineral manufacturing plant in South Carolina, he added, “The nation is regaining its autonomy.”

Countering Beijing's Control in Essential Minerals

Ending Beijing's processing and manufacturing dominance in these materials, which are crucial for advanced electronics, batteries, and military equipment, is a major focus for the American leadership. Through tariffs and other approaches, the US is betting on bringing the industry back to American shores.

These measures prompted China to restrict rare-earth exports to the US and pushed US leaders to sign deals with an ally, Malaysia, another nation, and Japan.

While the US and China have now reached a temporary agreement on rare earths, Beijing—with approximately 70% of worldwide extraction and over 90% of international refining—holds an advantage that may prove challenging to diminish.

“Rare earths are essential for EV engines but also in guidance systems that have clear uses for the defense department,” says an industry expert. “Anything that has a decent magnet in it requires rare earths.”

Challenging Path for US Independence

It won't be simple for the US to reset its reliance on Chinese production of materials essential to national security, chip manufacturing, and the transition from fossil fuels to renewable sources. Data from federal reports, the US imported the vast majority of the rare earths it consumed in 2024.

In the case of rare-earth minerals such as a key element, essential for chip production, and another mineral, critical for defense systems, Chinese refinement dominance rises to 99%. Dysprosium and terbium are found in magnets crucial to EV motors and generators in wind turbines, along with uses in cellphones, high-intensity lighting, and nuclear reactors.

Extended Timelines and Global Deposits

Efforts to cut the US’s dependence on China's output of rare-earth minerals could take years. Experts note that “Rare earths” is not entirely accurate because they’re not that uncommon in the earth’s crust, but many reserves, including those in Eastern Europe, where an agreement was signed recently, are only in the initial phases of mining.

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

Greenland, a key area of US attention, and South America, are two other countries with substantial rare-earth deposits. Domestically, there are reserves in California, the Midwest, and the central US, with the biggest active site operating at Mountain Pass, the state, about 60 miles from Las Vegas.

Government Initiatives and Funding

Recently, the Pentagon took on the role of the largest shareholder in an industry operator, with intentions to open a new “mine-to-magnet” plant, called a new facility, to make magnets crucial for F-35 fighter jets, unmanned systems, and naval vessels.

Across the continent, estimated reserves of rare earths were calculated at 3.6m tons in the US and additional millions in the northern neighbor—far less than the 44m tons estimated to be in the Asian giant.

Following government funding in other sectors and domestic technology firms, the interior department announced it was ready to make targeted funding in critical mineral companies.

“You’re competing against state capital because Beijing is selecting these strategically that they aim to control,” a senior official said during a speech this spring.

The official floated that the US could utilize a sovereign wealth fund to speed production. “Why wouldn’t the richest nation in the world not possess the largest state investment fund?” he questioned.

Historical Obstacles and Future Outlook

US efforts to support domestic production have floundered in the past when China lowered prices, rendering unsubsidized rare-earth development unprofitable against China’s lower cost of production and far-sighted planning.

Five years ago, a market expert stated before a congressional panel that “nations that fund in energy storage and supply chains now are likely to lead this sector for the foreseeable future. It is not too late for the US but action is needed now.”

Five years on, a scramble to assemble international partnerships around rare earths is speeding up.

“Soon, we’ll have an abundance of critical mineral and rare earths that supply will exceed demand,” the President told reporters. This followed eight months after a request for compensation in the form of minerals from Ukraine. In September, the government of Pakistan signed a contract with an American company, securing rights to minerals such as key metals.

Can the US Succeed?

But, can the US make up its shortfall and weaken China’s hold on rare-earth global networks? “The US has taken really significant steps so far,” a specialist comments. The nation, he adds, cannot be “self-reliant in the near future because it takes time to bring a mine online and establish processing plants.”