Released November 04, 2025 | SUGAR LAND
en
Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)
But the U.S. still will depend greatly on imports--mainly from China--for decades, as its own REM mining sector has grown only incrementally in recent years. Only one U.S.-based mine is currently producing rare earth materials.
U.S. President Donald Trump, who has been pressing China to reduce illegal exports of fentanyl, announced Thursday that the U.S. tariffs on China had been reduced from 20% to 10%.
Still, experts are cautious because of the unsteadiness of the U.S.-China trade history--and because details of the agreement are yet to be released.
The USGS report does indicate some small growth in U.S. production. In 2020, the U.S. imported 100% of its REMs from elsewhere, while by 2024 that percentage had dropped to 80%. The U.S. produced 45,000 tons of rare earth ores (REOs) in 2024, compared to 39,000 tons in 2020.
Industrial Info is tracking 20 domestic REM projects, both mining and processing, with a total investment value (TIV) of more than $5 billion.
Industrial Info expects the impact of the delay to be small. "While this is a nice short-term reprieve, I don't see the one-year delay in Chinese rare earth export restrictions changing the momentum for reshoring of rare earth mining and refining to the U.S.", says Joseph Govreau, VP Research Metals & Minerals for Industrial Info.
Govreau noted the U.S. Department of Defense (DOD) recently took a 15% stake in MP Materials Corporation (Las Vegas, Nevada), which operates the Mountain Pass Mine in California--the only REM production operation in the U.S.
The DOD has committed to funding the construction of a second production facility to supply the needs of the Pentagon, which has contracted to buy 100% of the facility's output for 10 years. It also guarantees a floor price for the output, which would keep the company profitable if China should flood the market.
The report adds, "Since the end of 2024, U.S. solar cell production capacity has more than tripled, rising from 1 GW to 3.2 GW." Domestic manufacturing of other components, including inverters and storage batteries, also has increased.
While renewable-energy funding has been reduced by the Trump administration, sparking concerns in the solar and other renewable industries, the sector remains strong. Industrial Info is tracking almost 1,800 solar projects with a TIV of about $600 billion.
By the Numbers
The opinion piece followed an April 4 announcement of export controls on seven heavy rare earth elements, "as well as all related compounds, metals, and magnets."
The piece continued, "As export volumes fell sharply in April and May, many carmakers in the United States, Europe and elsewhere struggled to obtain permanent magnets, with some forced to cut utilization rates or even temporarily shut down factories. Even after trade volumes recovered, rare earth prices in importing countries remained elevated--with European prices reaching up to six times those in China--hurting the cost competitiveness of rare earth-based products manufactured outside China."
The IEA says the supply of REMs is among the least-diversified markets in the world, alluding to numbers showing China controls 60% of that market.
So, while the tariff reprieve is good for the supply chain, manufacturers and consumers, diversification efforts still are crucial.
Key Takeaways
About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
Summary
The one-year delay in an embargo on Chinese exports of rare earth minerals will benefit supply chains and pricing for U.S. industry. But stateside rare-earth producers are decades away from overcoming China's production dominance.The Real Deal
Because China dominates the world in critical rare earth minerals (REMs), accounting for 60% of production and 90% of processing, a newly negotiated one-year delay in restrictions on exports headed for the U.S. will benefit the latter's tech developers, including those in the renewable and data center sectors.But the U.S. still will depend greatly on imports--mainly from China--for decades, as its own REM mining sector has grown only incrementally in recent years. Only one U.S.-based mine is currently producing rare earth materials.
U.S. President Donald Trump, who has been pressing China to reduce illegal exports of fentanyl, announced Thursday that the U.S. tariffs on China had been reduced from 20% to 10%.
Still, experts are cautious because of the unsteadiness of the U.S.-China trade history--and because details of the agreement are yet to be released.
The Dependency is Deep
According to data from the U.S. Geological Survey (USGS), 70% of the REMs used within the U.S. from 2020-23 came from China. Other significant sources include Malaysia (13%) and Japan (6%).The USGS report does indicate some small growth in U.S. production. In 2020, the U.S. imported 100% of its REMs from elsewhere, while by 2024 that percentage had dropped to 80%. The U.S. produced 45,000 tons of rare earth ores (REOs) in 2024, compared to 39,000 tons in 2020.
Industrial Info is tracking 20 domestic REM projects, both mining and processing, with a total investment value (TIV) of more than $5 billion.
Industrial Info expects the impact of the delay to be small. "While this is a nice short-term reprieve, I don't see the one-year delay in Chinese rare earth export restrictions changing the momentum for reshoring of rare earth mining and refining to the U.S.", says Joseph Govreau, VP Research Metals & Minerals for Industrial Info.
Govreau noted the U.S. Department of Defense (DOD) recently took a 15% stake in MP Materials Corporation (Las Vegas, Nevada), which operates the Mountain Pass Mine in California--the only REM production operation in the U.S.
The DOD has committed to funding the construction of a second production facility to supply the needs of the Pentagon, which has contracted to buy 100% of the facility's output for 10 years. It also guarantees a floor price for the output, which would keep the company profitable if China should flood the market.
Reassuring and Reshoring Renewables
The administration's REM deal is important to a related issue: the reshoring of renewables, such as solar panels and batteries, which is another market dominated by China. Recent data from the Solar Energy Industries Association (SEIA) shows that "the entire solar supply chain has been reshored, and U.S. manufacturing capacity has grown across every segment of the solar and storage supply chain."The report adds, "Since the end of 2024, U.S. solar cell production capacity has more than tripled, rising from 1 GW to 3.2 GW." Domestic manufacturing of other components, including inverters and storage batteries, also has increased.
While renewable-energy funding has been reduced by the Trump administration, sparking concerns in the solar and other renewable industries, the sector remains strong. Industrial Info is tracking almost 1,800 solar projects with a TIV of about $600 billion.
By the Numbers
- 20% down to 10%: The new agreement's reduction in the U.S. tariff on Chinese imports
- One year: Length of delay in China's previously announced moratorium on exporting rare earth minerals to the U.S.
- 70%: Share of U.S. rare earth mineral imports from China.
- 20: the number of domestic rare earth projects Industrial Info is tracking.
Supply Chain Concerns
In an opinion piece issued just days before the October 30 agreement, the International Energy Agency (IEA) expressed concerns about availability and price of the minerals and products made from them--as China also dominates in the REM-rich permanent magnet market.The opinion piece followed an April 4 announcement of export controls on seven heavy rare earth elements, "as well as all related compounds, metals, and magnets."
The piece continued, "As export volumes fell sharply in April and May, many carmakers in the United States, Europe and elsewhere struggled to obtain permanent magnets, with some forced to cut utilization rates or even temporarily shut down factories. Even after trade volumes recovered, rare earth prices in importing countries remained elevated--with European prices reaching up to six times those in China--hurting the cost competitiveness of rare earth-based products manufactured outside China."
The IEA says the supply of REMs is among the least-diversified markets in the world, alluding to numbers showing China controls 60% of that market.
So, while the tariff reprieve is good for the supply chain, manufacturers and consumers, diversification efforts still are crucial.
Key Takeaways
- The moratorium is only for a year, but Trump expects it to be renewed.
- Continued supply of these minerals is a relief to U.S. industry, including those adding solar panels and data centers.
About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
