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Not long ago, a top US official returned from a southern state displaying a tiny sample of metal, declaring it was the initial rare-earth magnet made in the US in decades.

He indicated that this was evidence the US is breaking “China’s chokehold on our industrial pipeline.” Thanks to a recently opened rare-earth mineral manufacturing plant in South Carolina, the official continued, “We’re finally becoming independent again.”

Countering China’s Dominance in Critical Materials

Reducing Beijing's refining and production supremacy in these minerals, which are essential for advanced electronics, energy storage, and military equipment, is a top priority for the current US administration. Using economic tools and other strategies, the US is relying on returning the industry back to US soil.

Such tariffs led China to limit rare-earth exports to the US and pushed US leaders to forge agreements with Australia, a partner, another nation, and Japan.

While the US and China have since brokered a trade truce on rare earths, China—with around the majority of worldwide extraction and nearly all of global processing capacity—holds an advantage that will be difficult to diminish.

“These materials are essential for EV engines but also in guidance systems that have obvious applications for the military,” notes an industry expert. “Any device that has a strong magnet in it uses rare earths.”

No Easy Fix for American Self-Sufficiency

There’s no easy fix for the US to reduce its dependence on Chinese production of minerals essential to national security, chip manufacturing, 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.

For some rare-earth minerals such as a key element, used in chip production, and another mineral, essential to defense systems, Chinese refinement dominance rises to almost total. These elements are used in magnets crucial to EV motors and generators in renewable energy, along with uses in cellphones, high-intensity lighting, and energy plants.

Extended Timelines and International Resources

Efforts to cut the US’s reliance on Chinese production of rare-earth minerals could take years. Experts note that “Rare earths” is not entirely accurate because they’re relatively abundant in the earth’s crust, but many deposits, including those in Ukraine, where an agreement was made earlier this year, are only in the early stages of extraction.

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

The Arctic region, another focus of US attention, and South America, are two other countries with significant rare-earth deposits. In the continental US, there are reserves in the West, Wyoming, and the central US, with the largest operational mine operating at Mountain Pass, California, about 60 miles from Las Vegas.

Federal Efforts and Investment

In July, the Pentagon became the major investor in an industry operator, with plans to open a new “integrated” plant, named 10X, to produce magnets crucial for F-35 fighter jets, drones, and submarines.

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

Mirroring government funding in other sectors and US chipmakers, the interior department announced it was ready to make direct investments in strategic resource firms.

“You’re competing against government-backed investment because China is selecting these strategically that they aim to control,” a cabinet member said during a speech in April.

He suggested that the US could use a national investment pool to accelerate production. “Why wouldn’t the wealthiest country in the world not possess the largest state investment fund?” he questioned.

Historical Obstacles and Prospects

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

Five years ago, an industry leader stated before a congressional panel that “those who invest in energy storage and supply chains now are poised to dominate this sector for generations to come. It is not too late for the US but action is needed now.”

Since then, a scramble to build trading alliances around rare earths is accelerating.

“In about a year from now, we’ll have an abundance of critical mineral and rare earths that supply will exceed demand,” a top leader informed reporters. This followed in the wake of a request for payment in the form of natural resources from another country. In September, the government of Pakistan agreed to a deal with an US firm, giving it access to minerals such as key metals.

Can the US Succeed?

However, can the US make up its gap and loosen China’s hold on rare-earth global networks? “The US has taken really significant steps already,” a specialist comments. The US, he continues, is unlikely to become “self-reliant in the near future because it requires years to bring a mine online and establish processing plants.”