• Geographer Julie Klinger argues the U.S. could meet rare earth demand through recycling mine waste and electronics rather than opening new mines.
• Her case overlooks critical scale and timing challenges.
• Recycling rates remain below 1% globally, and recovered materials still require the same processing infrastructure dominated by China.
• Recycling is a complement to, not a replacement for, domestic refining capacity.
• The real solution requires unglamorous capital investment in processing capacity first.
• This should be paired with recycling and selective mining.
• Waste recovery should not be treated as a shortcut past the supply chain’s hardest step.

In a February 6 opinion essay (opens in a new tab) in The New York Times, geographer Julie Michelle Klinger (opens in a new tab) contends that fears of China’s rare-earth dominance are exaggerated. She argues that the United States could meet most of its demand by recovering rare earths from mine waste, industrial scrap, and discarded electronics, rather than opening new mines. Mining, she suggests, is slow, environmentally risky, and often unnecessary; recycling and domestic processing should take priority.

Where the Essay Is Solid

Several core points are accurate. Rare earths are not geologically scarce. China’s dominance is concentrated in processing, not in exclusive access to ore. Western nations did, over decades, outsource hazardous and capital-intensive refining to China, eroding domestic expertise. And recycling rates for rare earths remain below 1% globally, an undeniable inefficiency.

Klinger is also right to puncture repeated mining hype—from Greenland to the deep seabed—that has produced headlines rather than durable supply.

Where the Case Breaks Down

The problem is scale and timing. Recycling and waste recovery are necessary—but nowhere near sufficient in the near-to-medium term. Rare earths are used in tiny quantities, embedded in complex products, and locked into magnets and alloys that are expensive and chemically intensive to separate. The U.S. lacks industrial-scale collection, disassembly, and solvent-extraction infrastructure to turn theory into tonnage.

Claims that the U.S. could meet “most” of its needs through waste recovery rest on theoretical resource estimates, not operating systems. “Recoverable” does not mean recoverable economically, at purity, at scale, and on schedule—especially for heavy rare earths such as dysprosium and terbium, which are essential for defense systems and EV drivetrains.

The Missing Middle Everyone Avoids

Ironically, the essay concedes the key truth and then glides past it. Processing is the bottleneck—and recycling does not bypass it. Scrap still must be separated, refined, metallized, and qualified. Without domestic solvent extraction, metal-making, and magnet manufacturing, recycling simply feeds the same choke point China already dominates.

REEx Take

Recycling is a pillar, not a panacea. Treating it as an alternative to mining and processing risks repeating the very mistake that created today’s dependency: confusing material abundance with supply security. The real solution is unglamorous and capital-intensive—processing capacity first, paired with recycling and selective mining.

The New York Times is right to challenge mining mythology. It is wrong to suggest the hardest step can be skipped.

Source: The New York Times, Opinion

• MST Access reports Energy Fuels' acquisition of Australian Strategic Materials could create one of the most complete ex-China rare earth supply chains by combining U.S. separation assets with proven metallization capabilities.
• The deal addresses China's downstream dominance in rare earth processing—separation, metallisation, and alloying—rather than upstream mining, creating a credible 'mine-to-metals' Western alternative.
• Expansion plans target 6,000 tonnes per year of NdPr by 2028-2029, though execution risks include high capital intensity, regulatory approvals, and China's continued market influence through pricing controls.

In a detailed February 2026 research report (opens in a new tab), analyst Chris Drew of MST Access examines Energy Fuels’ agreement to acquire Australian Strategic Materials (ASM (opens in a new tab))—a transaction the author argues could create one of the most complete ex-China rare earth supply chains in the Western world. The deal, structured as a Scheme of Arrangement and expected to close by mid-2026, combines Energy Fuels’ U.S. feedstock and separation assets with ASM’s proven metallization and alloying capabilities, directly targeting China’s long-standing dominance in rare earth processing

How the Study Was Conducted

MST Access’s report is an equity research analysis rather than a laboratory study. It synthesizes company disclosures, feasibility studies, balance-sheet data, and project timelines to assess the strategic logic and risks of the acquisition. The analysis tracks assets across the full rare earth value chain—mining, separation, metallisation, and alloying—and evaluates whether the combined entity can realistically deliver at scale outside China.

Key Findings: Where the Leverage Really Lies

The report’s central conclusion is straightforward: China’s advantage is downstream, not upstream. While rare earth ores exist globally, China controls the most difficult stages—separation, metallisation, and alloy production. Energy Fuels provides feedstock supply and separation capacity at its White Mesa Mill in Utah, which currently produces light rare earths and is piloting heavy rare earth separation. ASM contributes something far rarer in the West: commercial-scale metallization and alloying, already operating at its Korean Metals Plant and planned for duplication in the United States.

According to MST, this combination creates a “mine-to-metals” platform capable of delivering rare earth metals and alloys without relying on Chinese processors—an industrial configuration few Western firms can currently match.

Implications for the China Monopoly

For policymakers and investors, the implication is not that China’s monopoly is broken—but that a credible alternative pathway is emerging. The report highlights planned expansions at White Mesa, including a Phase 2 project targeting up to 6,000 tonnes per year of NdPr and meaningful quantities of dysprosium and terbium, contingent on financing and construction timelines. If executed, this would materially reduce Western exposure at the most sensitive processing stages.

Limitations and Open Risks

The analysis is candid about constraints. Most expansion plans extend to 2028–2029, underscoring that rare earth processing capacity cannot be built overnight. Capital intensity is high, regulatory approvals remain pending, and China retains the ability to influence markets through pricing and export controls. The report also notes that the successful integration of ASM’s assets and the completion of the acquisition are critical execution risks.

Conclusion

MST Access’s study does not claim a silver bullet. Instead, it documents a structural response to China’s dominance in rare earths: vertical integration across feedstock, separation, and alloying within allied jurisdictions. If delivered as outlined, the Energy Fuels–ASM combination would mark one of the most tangible Western efforts yet to compete where China has been strongest for decades.

Source: MST Access, “Fueling Up: Energy Fuels to Acquire ASM,” February 4, 2026

• The US and UAE signed a framework to cooperate on critical minerals and rare earths.
• This partnership leverages American policy tools with Emirati investment capital to reduce dependence on China's dominance in mining and processing.
• China holds 70% of the mining and 90% of the processing control over these resources.
• The agreement is strategic but currently lacks concrete projects, such as named mines, tonnage commitments, or separation plants.
• Realistic timelines for building processing capacity are estimated at 5-7 years, even with funding.
• Gulf capital's speed and flexibility could potentially change the financing landscape for Western rare earth projects.
• However, financial investments alone won't solve the chemical and capacity challenges needed to reduce China's influence.

The United States and the United Arab Emirates have signed a framework to cooperate on critical minerals and rare earths, aiming to reduce reliance on China. Announced during a Washington ministerial hosted by U.S. Secretary of State Marco Rubio, the deal links U.S. tools, such as stockpiles, to the UAE’s strategic reserves and investment capacity. It builds on Pax Silica, a U.S.-led alliance focused on AI-related supply chains that the UAE joined earlier this year. In short, Washington brings policy, Abu Dhabi brings capital, and both hope to speed up non-Chinese supply chains.

What’s Real—and Worth Noting

This is a framework, not a treaty or project announcement. That matters. The agreement commits the two governments to coordinate policy, align public and private investment, and use existing tools to accelerate supply and processing. There are no named mines, no tonnage commitments, and no new separation plants—yet.

Still, the strategic intent is accurate and significant. China remains dominant—roughly 70% of rare earth mining and about 90% of processing—and U.S.officials now openly frame this as a national security risk. TheUAE’s role is not as a miner but as a financial and logistics hub, capable of deploying large, patient capital where Western projects often stall.

Where Optimism Runs Ahead of Physics

What the coverage gets right—but could emphasize more—is the time problem. Processing and separation capacity cannot be conjured by frameworks. Even with capital, building refineries, training operators, and achieving stable yields typically takes five to seven years. Stockpiles and forums buy time; they do not replace chemistry.

The newly announced FORGE initiative (Forum on Resource Geostrategic Engagement) sounds muscular, but enforcement mechanisms remain undefined. Without downstream buildout, coordination risks becoming declarative.

Why This Matters in Rare Earth Terms

The notable shift is in who shows up with money. Gulf capital—fast, flexible, and comfortable with long-duration bets—could shorten timelines for allied projects if paired with processing assets in the U.S. or friendly jurisdictions. That does not end China’s dominance, but it changes the financing equation, which has quietly been the West’s weakest link.

About the Source

The National is an Abu Dhabi–based English-language daily with strong access to Gulf policy and investment circles. Its reporting is generally pro-development and establishment-aligned—useful for understanding intent, while warranting scrutiny on execution.

REEx Take

This pact won’t crack China’srare earth grip overnight. But it signals something new: serious capital stepping onto the board. In rare earths, money doesn’t solve chemistry—but it decides who gets the chance to try.

Source: The National (UAE)

• In 2025, Baogang Electric delivered over 1,700 rare-earth permanent-magnet motors, marking China's shift from pilot programs to scaled industrial production in high-efficiency electric machinery.
• The company completed 39 motor models across seven product families.
• A new assembly workshop was opened, enabling standardized, professionalized manufacturing with full Chinese certifications for regulated markets.
• China demonstrates end-to-end rare-earth integration—from upstream resources through midstream materials to scaled downstream motor manufacturing—while Western nations still focus on rebuilding mines and processing.

China’s state-owned Baogang Group says its electrical equipment subsidiary, Baogang Electric (Sendi), delivered more than 1,700 rare-earth permanent-magnet motors in 2025, a clear sign that China is moving beyond pilot programs to scaled, repeatable industrial production in high-efficiency electric machinery.

The company frames the milestone as new momentum for China’s “two rare-earth bases” strategy—policy shorthand for locking in leadership not only in rare-earth materials, but in downstream manufacturing and deployment. For business audiences, the key takeaway is operational: this is not R&D hype, but a step-change in output.

What Changed—and Why It Matters

During China’s 14th Five-Year Plan, Baogang Electric aligned with national “dual-carbon” targets (carbon peaking and neutrality), forming a new-energy division focused on wind, solar, hydrogen, energy storage, and permanent-magnet motor systems. The company reports completing seven product families spanning 39 motor models, alongside small-batch production of wind-power generators.

The inflection point came in 2025, when a new permanent-magnet motor assembly workshop reached full operation, enabling standardized, professionalized, and scalable manufacturing. That facility underpinned the jump to 1,700 annual deliveries—an output level that typically requires stable customers, supply reliability, and quality controls.

Technology, Certification, and Market Access

Rare-earth permanent-magnet motors are prized for high efficiency, energy savings, and reliability, making them central to industrial decarbonization. Baogang Electric reports obtaining multiple Chinese certifications for high- and low-voltage three-phase permanent-magnet synchronous motors, with at least one product line passing China’s mandatory 3C certification. This opens regulated markets including coal mining, petrochemicals, metallurgy, and heavy industry.

Commercial deployments include crushers, mixers, rolling-mill hydraulic systems, fans, and pumps—use cases where energy efficiency translates directly into operating-cost savings.

Why the West Should Pay Attention

The significance is less about the headline number than the integration it represents. Baogang sits atop upstream rare-earth resources, feeds midstream magnet materials, and now demonstrates scaled downstream motor manufacturing. That end-to-end capability is precisely what the U.S. and Europe are attempting—slowly—to rebuild.

As Western policy focuses on mines and processing, China is already turning rare earths into finished industrial machines, tightening its competitive grip in electrification and clean-industry equipment.

What’s Next

Baogang Electric says it will expand regionally, promote a “manufacture–remanufacture–reuse” green model, and push permanent-magnet motors from targeted applications toward broader industrial adoption.

Disclosure / Disclaimer: This news item originates from media affiliated with a Chinese state-owned enterprise. All production figures, certifications, and market claims should be independently verified using non-state and third-party sources before being relied upon for investment, policy, or strategic decisions.

• The US has proposed a critical minerals trading bloc with Japan, the EU, and Mexico.
• The bloc features coordinated trade rules, potential price floors, and project support to counter China's 90% control of rare earth processing.
• Vice President J.D. Vance advocates for enforceable price floors backed by adjustable tariffs to address market volatility.
• Market volatility has made non-Chinese investment 'nearly impossible' in the sector.
• The real bottleneck is midstream processing—not mining—requiring parallel investment in separation, metallurgical expertise, and manufacturing capacity.
• These investments are needed to create a durable industrial strategy beyond stockpiles.

The United States has opened a new front in the critical minerals contest—this time not with tariffs alone, but with a proposal to build a preferential trading bloc among allies aimed at stabilizing prices and weakening China’s grip on supply chains. Unveiled at a Washington ministerial hosted by Secretary of State Marco Rubio, the plan brings Japan, the European Union, and Mexico into early talks on coordinated trade rules, potential price floors, and project support. Singapore’s Foreign Minister Vivian Balakrishnan (opens in a new tab) attended and struck a familiar note—support for open, rules-based trade and resilient supply chains—underscoring both the ambition and the caution surrounding the effort.

At its core, the initiative acknowledges a reality long glossed over: China’s leverage is not just geological. While China accounts for roughly 60% of the rare earth supply upstream, it controls close to 90% of the processing that turns mined material into usable inputs like magnets. That downstream choke point—not ore—confers power. Vice President J. D. Vance was unusually blunt, arguing that volatile prices and alleged market flooding have made non-Chinese investment “nearly impossible.” His prescription—enforceable price floors backed by adjustable tariffs—aims to restore predictability so capital will flow.

There are concrete signals beneath the diplomacy. U.S. trade officials say the U.S., Japan, and the EU intend to conclude a memorandum of understanding within 30 days to jointly support mining, refining, processing, and recycling projects, with a parallel U.S.–Mexico plan to follow within 60 days. Those timelines suggest urgency, not just symbolism.

Yet much remains aspirational. Price floors are politically sensitive and historically fraught; past commodity schemes collapsed when governments promised stability without enforcing discipline or coordinating demand. Details on floor levels, enforcement, and loss-sharing are conspicuously absent. And while more than 50 countries attended, most have not publicly committed—an important distinction, as enthusiasm does not equal alignment, suggests Reuters and Singapore’s The Straits Times (opens in a new tab).

Media coverage has largely framed the proposal as a mining story. That’s misleading. The bottleneck is midstream processing—separation, metallurgical expertise, and downstream manufacturing capacity. Without parallel investment in these segments, a trading bloc risks becoming a talking shop with stockpiles attached, rather than a durable industrial strategy.

Why this moment still matters: senior U.S. officials have now said out loud what investors already know—that price volatility, not geology, is killing Western supply chains. If the next steps deliver enforceable mechanisms and sustained midstream buildout, this could mark a genuine pivot. For now, it’s a credible opening bid—ambitious, necessary, and unfinished.

• Hallgarten's 2026 report argues the U.S. has lost its mining empire, remaining structurally dependent on foreign capital and processing capacity despite political rhetoric around reshoring critical minerals.
• The analysis reveals that owning raw minerals means nothing without control of downstream processing—China's true advantage lies in refining and metallurgical capabilities, not just mining.
• Strategic stockpiles may buy time, but without deep investment in midstream processing, workforce skills, and sustained capital, the West risks confusing symbolic activity with actual supply-chain sovereignty.

In a forceful January 2026 market review, veteran mining analyst Christopher Ecclestone, editor of Hallgarten & Company (opens in a new tab), argues that the United States has quietly lost its mining “empire”—and may be mistaking noise for progress in critical minerals. In The End of Empire (opens in a new tab), Ecclestone contends that despite political rhetoric around reshoring, stockpiling, and strategic minerals, the U.S. remains structurally dependent on foreign capital, foreign operators, and—most critically—foreign processing capacity, particularly in rare earths and specialty metals.

What Hallgarten Examined—and How

Hallgarten’s report is not a laboratory study but a market strategy analysis, blending commodity price data, historical case studies, capital-market behavior, and geopolitical context. Across more than a dozen pages, the review surveys metals markets (tin, tungsten, precious metals), U.S. mining capacity, and recent government initiatives such as strategic stockpiles and proposed price supports. Charts and tables—such as tin prices exceeding $50,000/tonne (page 6) and a breakdown of the proposed $12 billion U.S. “Project Vault” stockpile (page 10)—anchor the argument in observable market data.

Key Findings

Hallgarten’s core claim is blunt: the West confuses ownership of minerals with control of supply chains. According to the report, most meaningful mining and processing activity in the U.S. is carried out by Canadian, Australian, or UK-listed firms, while rare earth ventures touted as “national champions” remain financially fragile and operationally immature.

On stockpiling, Ecclestone is cautiously supportive but skeptical of public theatrics. He argues that strategic reserves work best when built quietly—citing Japan’s long-standing model—rather than when broadcast to markets, which can inflate prices and reward speculative projects over resilient supply chains.

Crucially for rare earths, the report underscores that China’s advantage lies downstream. Mining alone does not confer power; processing, refining, and metallurgical know-how do. Without rebuilding these capabilities, Western stockpiles risk becoming symbolic buffers rather than strategic leverage.

Implications for the China Monopoly

The takeaway is simple: you cannot break a monopoly by buying raw materials if your rival controls the factories that turn them into usable products. Hallgarten’s analysis implies that U.S. and allied policy remains fragmented—focused on upstream mining while neglecting midstream processing, workforce skills, and capital markets capable of sustaining cyclical commodity businesses.

Limitations and Controversial Notes

The report is intentionally provocative and openly opinionated. Some characterizations—particularly of U.S. rare earth companies and political figures—reflect Ecclestone’s long-held skepticism rather than neutral consensus. The analysis also downplays emerging industrial-policy tools (e.g., EXIM and DFC financing) that may yet alter outcomes. Readers should treat the work as a strategic critique, not a forecast certainty.

Conclusion

Hallgarten’s End of Empire is less an obituary than a warning. Strategic stockpiles may buy time, but without deep investment in processing, pricing discipline, and talent, the West risks confusing activity with capability. As Rare Earth Exchanges has repeatedly argued, supply-chain sovereignty is built—slowly, expensively, and unglamorously—not declared.

Source

Ecclestone, C. Monthly Resources Review: The End of Empire (Hallgarten & Company, Feb. 5, 2026)

Portfolio_January2026

• Landmark Nature Communications study overturns long-held assumption: magnetic strength in rare-earth magnets is governed by atomic-scale structures within crystal grains, not grain boundaries as previously believed.
• Researchers discovered ultra-thin copper-rich layers (1-2 atoms thick) act as 'perfect defects' that enhance magnet performance under extreme heat and stress, informing development of more powerful VACOMAX® samarium-cobalt alloys.
• Findings underscore that rare-earth magnet dominance depends on atomic-scale manufacturing intelligence rather than raw material access alone, with implications for U.S.-China technological competition and industrial policy.

In a landmark paper published in Nature Communications (opens in a new tab), lead author S. Giron and an international team spanning German universities, UK collaborators, and industrial partner VACUUMSCHMELZE GmbH & Co. KG (VAC) (opens in a new tab) overturn a long-held assumption about high-performance rare-earth magnets. Working within Germany’s Collaborative Research Center SFB/TRR 270 (opens in a new tab) (“HoMMage”), the researchers show that magnetic strength and thermal stability are governed less by grain boundaries—and more by atomic-scale structures and elemental distributions inside the grains themselves. The insight has already informed the rollout of more powerful VACOMAX® samarium-cobalt (SmCo) alloys, with implications that extend from factory floors to geopolitics.

The CRC 270 HoMMage team in Germany

How the Study Worked

Rare-earth magnets are the quiet workhorses of electric vehicles, drones, wind turbines, and defense systems. The team focused on a high-temperature SmCo magnet—Sm₂(Co, Fe, Cu, Zr)₁₇—and combined advanced magnetic measurements with multiple electron-microscopy techniques and micromagnetic simulations. This toolkit allowed the scientists to visualize how atoms are arranged and how magnetic domains behave at the nanoscale.

Crucially, they compared magnets that appeared similar under conventional microscopes but performed very differently in practice—differences that only emerged when examined atom by atom.

Stefan Giron, First Author, Institute of Materials Science, Technische Universität Darmstadt

What They Found: The Power Is in the “Defects”

The discovery is counterintuitive. Grain boundaries—the borders between crystal regions—were long thought to be the weak points where demagnetization begins. This study shows they are not the primary culprit.

Rather, the strongest magnets contain ultra-thin, copper-rich layers just one to two atoms thick embedded within the crystal grains. These features act as pinning centers, impeding the motion of magnetic domains and preserving performance even under extreme heat and stress.

The team describes these as “perfect defects”: imperfections so precisely arranged that they enhance performance. Tiny shifts in atomic placement or elemental distribution can yield outsized gains in strength and reliability.

Why This Matters for the China Question

China’s dominance in rare-earth magnets is not just about access to ore; it reflects mastery of process know-how—the industrial craft of translating materials science into repeatable, high-yield production. This study underscores that the true bottleneck is no longer mining alone, but atomic-scale manufacturing intelligence, protected by patents, talent pipelines, and close industry–academia integration.

For the U.S. and its allies, the implication is stark: stockpiles and trade deals are necessary but insufficient. Durable advantage will accrue to those who own the science of nanostructure design—and can industrialize it at scale.

Limitations and Open Questions

The work centers on samarium-cobalt magnets, prized for thermal and chemical stability but used in more specialized applications than mass-market NdFeB magnets. Extending these insights across magnet classes will require further research. Questions of scalability, cost, and intellectual-property access also remain—and could become points of contention in a more competitive global landscape.

Conclusion

The study makes a simple truth unavoidable: rare-earth sovereignty is engineered, not excavated. Control at the atomic level may prove more decisive than access to raw materials, reshaping how nations think about industrial policy, alliances, and technological independence.

Citation

Giron et al., Nature Communications 16, 11335 (2025). DOI: 10.1038/s41467-025-67773-7

• U.S. partners with the EU, Japan, and Mexico on coordinated trade rules and price floors to reduce critical minerals dependence on China for defense and tech manufacturing.
• Vice President JD Vance acknowledges 'the market is failing,' signaling a shift toward binding plurilateral agreements and rule-based mineral coordination.
• Price floors could de-risk Western mining projects, but success requires synchronized midstream build-out, workforce programs, and allied financing beyond stockpiles.

The U.S. says itwill work with the European Union, Japan, and Mexico to reduce dependence on China for critical minerals used in defense, energy, and high-tech manufacturing. Announced at a Washington ministerial hosted by JD Vance and Marco Rubio, the plan includes coordinated trade rules, possible price floors, and fast-tracked agreements—building on President Trump’s proposed $12 billion minerals stockpile. The goal: stabilize prices, unlock investment, and rebuild supply chains outside China.

Solid as a Rock—and Why It Matters

According to Rare Earth Exchanges™ (REEx) yesterday, plus Reuters and Bloomberg, U.S. Trade Representative Jamieson Greer confirmed plans with the European Commission and Japan to develop “action plans” for resilience, including border-adjusted price floors. This is notable. REEx has long argued that price volatility—not geology—is the main killer of Western projects. Price floors, if real, could finally de-risk capital across mining, processing, and manufacturing.

Vice President JD Vance—Recognizing the “Market” is Not Enough

Equally important is the language around a binding plurilateral agreement. That signals a shift from ad-hoc deals to rule-based coordination—something China has practiced for decades.

Where the Fog Creeps In

Details remain thin. Which minerals? What floor levels? Who funds losses if markets fall? Mexico’s 60-dayaction plan gestures toward joint projects but names none. Canada’s absence—despite attending—raises questions about North American coherence ahead of the USMCA review.

There’s also a subtle media bias toward treating the stockpile as a solution. REEx’s view: stockpiles buy time; industrial policy builds power. Without synchronized midstream build-out, workforce programs, IP protection, and allied financing, price floors risk becoming political slogans.

Why This Moment Is Different

Vance’s blunt admission—“the market is failing”—matters. It legitimizes intervention. If followed by enforceable pricing mechanisms and multinational execution, this could mark the real start of a Western critical-minerals bloc.

• EXIM approved $10 in long-term loans to launch Project Vault, a public-private partnership creating a U.S. Strategic Critical Minerals Reserve with early participants including GE Vernova, Boeing, Clarios, and Western Digital.
• Project Vault provides strategic insurance against supply shocks but stockpiles alone cannot solve chronic supply deficit without comprehensive industrial policy addressing upstream mining, mid-separation/refining, and downstream manufacturing.
• REE advocates that true sovereignty requires a full-spectrum strategy: pricing support, midstream buildout, downstream IP, workforce development, regulatory reform, and allied financing—not storage alone.

The Export-Import Bank of the United States has approved up to $10 billion in direct lending to launch Project Vault, establishing a U.S. Strategic Critical Minerals Reserve through a public-private partnership. Announced alongside President Trump, the initiative aims to buffer U.S. manufacturers from supply shocks, reduce dependence on foreign-controlled supply chains, and anchor domestic production and processing. Early OEM participants include GE Vernova, Boeing, Clarios, and Western Digital, with suppliers such as Traxys, Mercuria Americas, and Hartree Partners. EXIM says the structure targets taxpayer-positive returns while strengthening U.S. manufacturing jobs and national security.

Project Vault — Q&A

Why A Stockpile is not Enough

A stockpile like Project Vault is necessary—but on its own, it is strategic insurance, not strategic power. Rare Earth Exchanges has argued consistently that without a comprehensive industrial policy, a reserve risks becoming a static warehouse in a dynamic geopolitical war.

First, stockpiles do not create supply. They smooth shocks, but they don’t solvechronic upstream deficits. Without aligned incentives for mining—price floors, offtake guarantees, or risk-sharing capital—new projects won’t reach FID. Capital flees volatility, and critical minerals remain among the most volatile commodities on Earth.

Second, midstream is the real choke point. Separation, refining, alloying, and magnet-making are where China dominates. A stockpile of oxides is useless if the U.S. and allies lack scalable, cost-competitive processing. That requires long-term pricing support and coordinated demand signals across OEMs—not one-off loans. If not, nascent magnet makers will fall prey to market forces within a couple of years---and this could be disastrous—they essentially can’t keep up with Chinese pricing, go out of business, and/or become acquired by the Chinese.

Third, downstreammanufacturing and IP matter as much as tonnage. Without sustainedR&D, patent protection, and allied standard-setting, the West risks subsidizing inputs while China captures value in finished components. China now focuses on Two Ear Earth Base China and owning the future of the industry downstream.  Industrial policy must reward innovation, not just extraction.

Fourth, talent and workforce are missing links. Processing engineers, metallurgists, magnet designers, and industrial chemists cannot be conjured overnight. REEx has stressed the need for allied training pipelines—U.S., EU, Japan, Australia, Canada—treated as a shared strategic asset.

Fifth, fragmented permitting and funding kill momentum. The U.S. still runs critical minerals through a maze of agencies, timelines, and mismatched programs. Without rationalized permitting, synchronized DoD–DOE–EXIM–DFC financing, and multinational co-investment platforms, even well-funded projects stall.

Finally, this is a coalition problem, not a national one. China’s advantage is scale across borders—mines, refineries, factories, banks, and diplomacy moving in lockstep. A stockpile without a tight, rules-based multinational alliance merely delays dependence; it does not end it.

Bottom line: Project Vault buys time. Only a full-spectrum industrial strategy—pricing support, midstream buildout, downstream IP, workforce development, regulatory reform, and allied financing—converts time into sovereignty. Rare Earth Exchanges has been clear: resilience is engineered, not stored or a series of reactions.

• REalloys is merging with BLBX and has announced non-binding agreements with Kazakhstan's AltynGroup for a 10-year rare earth offtake and investment commitment to route Central Asian feedstock into North American processing.
• The company aims to build a vertically integrated platform targeting 275 tpa Dy+Tb and 3,400+ tpa NdPr output by 2027, anchored by Ohio's Euclid Magnet Facility.
• Critical investor questions remain unanswered, including:
  • Assay data for claimed Tb/Dy-bearing tailings
  • Offtake pricing formulas
  • Export logistics
  • Integration of Kazakhstan supply with the North American production timeline

REalloys—currently merging with Blackboxstocks (NASDAQ: BLBX)—announced non-binding agreements with AltynGroup Kazakhstan (owned by the Assaubayev family) to pursue a 10-year rare earth offtake and a parallel non-binding investment commitment, aiming to route Central Asian feedstock into North American processing and alloying. REEx is summarizing what’s known, what’s promotional, and what investors still need answered.

Note theAssaubayev family is a prominent, wealthy Kazakh family known for controlling major mining and natural resource companies, including AltynGroup Holdings (opens in a new tab) and formerly KazakhGold (opens in a new tab). Led by tycoon Kanat Assaubayev (opens in a new tab) and his sons, includingAidar and the late Baurzhan, they are considered one ofKazakhstan’s most influential business dynasties. 

Kazakhstan feedstock meets a U.S. “mine-to-magnet” story

The headline is geopolitically intuitive: diversify feedstock away from China by contracting supply from Kazakhstan and converting it into metals/alloys in North America. A recent press release picked up by media such as Michael Scott at OilPrice.com (opens in a new tab) claims initial feedstock may link to AltynGroup’s Kokbulak iron ore footprint via a rare-earth-bearing byproduct from tailings, including heavy rare earths like Tb/Dy (company/partner assertions; non-binding).

What’s accurate and material right now: the deal is non-binding (MoU-style), and the value hinges on whether producing mines, grades, recoveries, export logistics, and binding offtake pricing can be locked.

REalloys’ stated value proposition (and what’s “forecast”)

In its corporate materials (opens in a new tab), REalloys positions itself as building a vertically integrated platform: separation/refining + metallization + magnet manufacturing, anchored by the Euclid Magnet Facility (Ohio) and partnerships for midstream separation.

Thecompany’s corporate deck explicitly frames output as forecast (e.g., 275 tpa Dy+Tb and 3,400 tpa+ NdPr), and targets initial domestic production “by 2027.”

Key structural point for equity holders: REalloys plans a reverse takeover into BLBX targeted in Q1 2026, and protections that could materially shape dilution and downside/upside capture.

Investor vetting: the unanswered quest

for offtake tailings

What are the assay tables, REE distributions, and independent metallurgy results? (Tb/Dy claims need hard data.)

Offtake economics: Price formula, volumes, penalties, and who pays for separation/refining export permissions, transport corridors, and any sanction-adjacent risks.

Execution sequencing: How does Kazakhstan feed integrate with the company’s stated North American ramp timeline?

Stock snapshot (BLBX) + technical read

BLBX last traded around $11.39, with a wide intraday range (~$11.41–$12.99)—a reminder this is currently a volatility-driven story stock pending deal documents and merger milestones.

Source: “North American Company Deal in Kazakhstan,” Michael Scott, Feb. 4, 2026; REalloys Non-Confidential Information Memorandum / Corporate Presentation excerpts.

• China's combined wind and solar installed capacity is projected to exceed 1.8 TW by the end of 2025.
• Renewables are expected to represent 47.3% of the total capacity, surpassing thermal power by approximately 300 GW.
• Solar accounts for 30.8% of the installed capacity, but its actual electricity generation share is lower (~14%) due to intermittency and capacity factors.
• China's massive renewable deployment creates competitive advantages through:
  • Lower costs
  • Industrial learning
  • Supplier clustering
  • Export potential for manufacturers

China’s renewable buildout hit another milestone (opens in a new tab): combined wind and solar installed capacity exceeded 1.8 terawatts (1,840 GW) for the first time, according to China’s National Energy Administration and reporting by People’s Daily. By end-2025, China’s total installed generation capacity reached 3.89 TW (+16.1% YoY), with solar at 1.20 TW (+35.4%) and wind at 0.64 TW (+22.9%). Wind+solar now represent 47.3% of installed capacity, and the report says they exceed thermal capacity by roughly 300 GW—a symbolic threshold, even if it does not translate one-for-one into electricity output.

Solar’s Real Share of “Powering China”

Installed capacity is not the same as electricity produced. Solar’s capacity share is about 30.8% (1.20/3.89), but solar’s generation share is materially lower because sunlight is intermittent and capacity factors are lower than those of dispatchable plants.

Independent generation datasets suggest solar’s share of electricity has nonetheless surged—Ember analysis indicates solar reached roughly 14% of China’s electricity mix in June 2025, and wind+solar hit record monthly levels.

Why This Could Become a Competitive Advantage

Scale becomes an advantage when it turns into lower unit costs, faster iteration, and industrial learning. China’s massive deployment fuels demand for turbines, inverters, grid equipment, storage, and upstream inputs—including rare earth permanent magnets used in many wind turbines.

Over time, this can produce compounding benefits: denser supplier clusters, more standardized components, greater EPC experience, and a larger home market that absorbs early production runs. That “learning laboratory” effect can eventually translate into cheaper, faster, more bankable projects—and a tougher competitive environment for Western manufacturers, developers, and even grid technology vendors.

Disclaimer: This news item originates from People’s Daily, a Chinese state-affiliated outlet. Figures and framing should be verified independently and interpreted alongside power-generation data, grid integration, curtailment, and regional dispatch realities.

• China's Baotou Rare Earth Research Institute has deployed the country's first fully domestic high-temperature vibrating sample magnetometer (VSM).
• The VSM is capable of measuring permanent-magnet performance up to 800°C and 6 tesla.
• The deployment aims to reduce dependence on Western and Japanese suppliers.
• The new instrument enables higher-fidelity testing of NdFeB and SmCo magnets under extreme conditions.
• This move potentially strengthens China's dominant position in rare-earth magnet manufacturing by improving R&D cycles and quality control.
• Better metrology tools for magnetic materials have direct commercial implications for aerospace, EV motors, wind turbines, and emerging magnetocaloric applications.
• Performance claims from Chinese domestic media should be independently verified.

China’s Baotou Rare Earth Research Institute has put into service what it calls the country’s first high-temperature vibrating sample magnetometer (VSM) built entirely from domestically produced modules. According to the report, the system can precisely measure permanent-magnet performance under extreme conditions—up to 800°C and 6 tesla—and is being positioned as a step toward breaking foreign “monopolies” in high-end magnetic measurement tools.

Note the Chinese refer to a small cluster of Western and Japanese suppliers that dominate high-field, high-precision magnetic measurement systems, especially VSMs, SQUID magnetometers, and PPMS platforms.

The Claims

In a demonstration, an NdFeB sample reportedly showed stable magnetic performance at 150°C, with clear test curves produced by the new equipment.

Technically, the institute says the instrument is designed primarily for NdFeB and SmCo magnets, using superconducting excitation to reach 6T and to operate over a wide temperature range (up to 800°C). The narrative draws a contrast with older domestic “closed-loop” systems that typically rely on conventional electromagnets and top out around 3 tesla, and with imported high-end systems that often emphasize ultra-low-temperature measurements and are costly.

The claimed breakthrough is not a new magnet chemistry, but higher-fidelity testing capability—capturing subtle performance changes of rare-earth magnets under high-temperature/strong-field conditions and enabling more precise characterization across temperature- and field-sweep experiments.

Implications

For Western and U.S. readers, the commercial implication is straightforward: metrology is industrial power. Better measurement tools shorten R&D cycles, improve quality control, and accelerate iteration in magnets used in aerospace, EV traction motors, wind turbines, and emerging applications such as magnetocaloric (“magnetic refrigeration”) materials.

If the performance and reliability claims hold up, the new system could strengthen China’s already dominant position in rare-earth magnet manufacturing by improving upstream validation and downstream product qualification, making it easier for Chinese producers to deliver magnets with tighter specifications for high-heat-duty cycles.

The institute also emphasizes spillover benefits to nearby magnet manufacturers, suggesting the instrument will serve as a regional testing hub that improves data quality for industrial customers.

Disclaimer: This item is translated from Baotou News Network, a Chinese outlet. As the report originates from Chinese domestic media, key claims (performance specifications, “first in China” status, and comparative statements about foreign systems) should be verified independently before being relied upon for technical or investment decisions.

• Orion Critical Mineral Consortium proposes acquiring 40% of Glencore's Mutanda and KCC operations in DRC, valued at approximately $9 billion, securing U.S. access to copper and cobalt without operational control.
• The two mines produced 247.8 kt of copper and 33.5 kt of cobalt in 2025, representing strategic leverage over DRC's 70% share of global cobalt supply through offtake rights rather than ownership.
• Orion CMC's $1.8 billion platform, backed by U.S. DFC and ADQ, signals a shift in industrial policy—deploying equity stakes and contractual control to rewire critical mineral supply chains.

Glencore (opens in a new tab) and the Orion Critical Mineral Consortium (opens in a new tab) have entered into a non-binding Memorandum of Understanding that could materially reshape Western access to copper and cobalt from Central Africa.

Under the proposal, Orion CMC would acquire a 40% stake in Glencore’s interests in MutandaMining (opens in a new tab) and KamotoCopper Company (opens in a new tab), implying a combined enterprise value of approximately $9 billion. The United States is moving closer to the source of critical minerals—not by nationalizing assets, but by buying influence and offtake rights.

What’s Firm—and What’s Still Contingent

Established facts:

• The MoU is explicitly non-binding and subject to due diligence, definitive documentation, and regulatory approvals.
• Orion CMC would gain non-executive board representation and the right to directits proportional share of production to nominated buyers, consistentwith the U.S.–DRC Strategic Partnership Agreement.
• Operational control remains with Glencore, preserving continuity and existing management systems.

Still unresolved:

• Final valuation mechanics, governance details, and transaction timing.
• Any increase beyond the proposed 40% interest.

This distinction matters. Investors should treat the announcement as strategic intent, not execution.

Why These Assets Matter

Mutanda and KCC are not peripheral holdings. In 2025, the two operations produced a combined ~247.8 kt of copper and ~33.5 kt of cobalt, placing them among the most consequential copper–cobalt complexes outside China.

Cobalt is the strategic fulcrum. The Democratic Republic of Congo supplies roughly 70% of global cobalt, and Glencore remains the largest Western producer. By securing offtake influence rather than operating control, Washington is pursuing a capital-light, leverage-heavy approach—anchoring supply without assuming mine-operator risk.

Power Without a Flag

Orion CMC—established in October 2025 and led by Orion Resource Partners, with participation from the U.S. International Development Finance Corporation—signals a shift in industrial policy tools. Rather than relying on subsidies alone, the U.S. is deploying equity stakes, governance rights, and contractual offtake control.

This reflects a broader pattern: sovereignty through contracts and capital, not flags and ownership.

REEx Takeaway

A big, exciting deal, but of course, there is execution risk. The proposal signals seriousness and scale, yet its impact depends on closing conditions and long-term discipline.

If consummated, the transaction would strengthen U.S. and allied access to copper and cobalt while reinforcing Glencore’s position as the West’s anchor producer in the DRC. It is not a rare earth story. It is a critical-minerals power play—and a template worth watching.

Investor Profile

OrionCritical Mineral Consortium (Orion CMC) was formed in October 2025 as a $1.8 billion, U.S.-backed investment platform designed to strengthen American economic competitiveness and national security by securing critical mineral supply chains. Led by Orion Resource Partners in partnership with the U.S. International Development Finance Corporation, and supported by matching capital from ADQ (state-owned sovereign investment and holding company of the Government of Abu Dhabi) the consortium brings together government-backed capital and private-sector mining expertise. With an initial $1.8 billion committed and a stated target of $5 billion, Orion CMC is structured to mobilize capital rapidly into critical minerals that underpin advanced manufacturing, defense, energy transition, data centers, and AI infrastructure.

Strategically, Orion CMC prioritizes existing or near-term producing assets over long-dated frontier exploration, aiming to close the gap between geopolitical urgency and industrial timelines. The consortium focuses on investing in mining and processing assets, managing offtake, developing domestic and allied-country processing capacity, and scaling cost-effective mineral technologies across emerging and established markets.

Positioned as a bridge between resource-rich jurisdictions and Western industrial demand, Orion CMC represents a shift toward sovereignty through capital, governance, and offtake control, rather than state ownership—marking one of the most consequential public–private efforts to rewire critical mineral supply chains in favor of the United States and its allies.

Source: Glencore / Orion CMC joint announcement, 3 Feb 2026.

• The UK hosts rare earth mineral deposits but remains functionally dependent on Chinese midstream processing—a vulnerability confirmed by both the British Geological Survey and a government-commissioned Frazer-Nash study.
• In January 2026, the UK government offered £12 million to support Ionic Technologies' Belfast facility, designed to produce 400 tonnes annually of separated magnet rare earth oxides using recycling technology.
• This marks Britain's shift from geological surveys to industrial midstream capability—demonstrating that control over separation, metals, and magnet production, not mineral deposits, determines supply-chain sovereignty.

This updated Rare Earth Exchanges™ analysis revisits the United Kingdom’s rare earth dilemma by integrating two authoritative assessments—the British Geological Survey’s geology-first review and a UK government–commissioned paper on recycling and midstream processing—alongside newly announced government-backed magnet-recycling capacity. We separate enduring structural constraints from genuine progress and explain why midstream capability, not mineral occurrence, defines supply-chain sovereignty.  Thanks to community members for sending updated information as well.

Britain Has Rocks—Now It’s Building Circuits: The Rare Earth Bottleneck Revisited

British Geological Survey (BGS) study delivered an uncomfortable truth: while the UK hosts rare earth occurrences, it lacks commercial-scale separation and refining, leaving it functionally dependent on foreign—predominantly Chinese—midstream supply. That diagnosis remains correct. What has changed in 2025–2026 is the policy response—and, finally, industrial assets moving beyond the laboratory.

Authored by David Currie and Holly Elliott, The Potential for Rare Earth Elements in the UK dismantles a persistent illusion: geology alone does not equal security. Leverage accrues to those who control separation circuits, metals and alloys, and magnet production—not to those who merely extract rock.

That conclusion is now reinforced by a second, policy-driven analysis.

Two Studies, One Verdict: The Midstream Decides

A UK government–commissioned paper, UK Critical Minerals Recycling and Midstream Processing (opens in a new tab), authored by Frazer-Nash Consultancy (for the Department for Business and Trade), reaches the same destination from a different route. Rather than geology, it interrogates processing, recycling, skills, scale-up timelines, and market readiness—and finds the UK’s principal exposure sits squarely in the midstream.

Together, the BGS and Frazer-Nash papers converge on a single conclusion: without domestic separation, metal-making, and magnet-grade pathways, mineral endowment offers little strategic insulation.

What the Geology Gives—and Withholds

The BGS mapped REE-bearing formations in Wales, northwest Scotland, and parts of England. Localized samples can approach ~2% total rare earth oxides, but deposits are small, discontinuous, and uneconomic under current conditions. The UK has never produced rare earths at a commercial scale. On this point, the evidence is settled.

Downstream vulnerability persists. Even as China’s mining share trends toward ~65%, its dominance in separation, metals, and permanent magnets continues to anchor global leverage.

From Reports to Reality: Processing and Magnets Arrive

Here is the material update. In January 2026, the UK government issued an Offer in Principle for a £12 million capital (opens in a new tab) grant to support a commercial rare earth permanent-magnet recycling facility in Belfast, led by Ionic Technologies, a wholly owned subsidiary of Ionic Rare Earths. The proposed plant is designed to produce ~400 tonnes per annum of ≥99.5%-purity separated magnet rare earth oxides (Nd, Pr, Dy, Tb) using patented long-loop recycling technology, with targeted first production within ~two years, subject to final investment decision and due diligence

Ionic.

This isnot mining—and that is precisely the point. It is midstreamcapability, directly aligned with the UK’s Critical Minerals Strategy target of 10% domestic supply and 20% via recycling by 2035. Demonstration-scale operations have already produced separated dysprosium and terbium oxides, validating magnet-grade pathways beyond proof-of-concept.

Progress, With Proportions

Scale still matters. Recycling is additive, not substitutive. Volumes remain modest relative to national demand, and the UK still lacks primary separation from mixed concentrates. Yet Belfast breaks a long-standing binary: it demonstrates that Britain can host industrial REO separation for magnets, not just studies and strategy papers.

REEx Verdict

The diagnosis from both the BGS and Frazer-Nash stands: rocks alone do not confer power. But Britain is finally addressing the correct bottleneck. If Belfast reaches FID and ramps as planned, the UK moves from pure dependency to partial agency—not independence, but momentum. In rare earths, momentum is how leverage is rebuilt.

Sources: Currie & Elliott (2024), The Potential for Rare Earth Elements in the UK, British Geological Survey; Frazer-Nash Consultancy, UK Critical Minerals Recycling and Midstream Processing (UK Government-commissioned); Ionic Rare Earths ASX Announcement (27 Jan 2026).

• Secretary Rubio signals US interest in Argentina as a critical minerals partner to reduce China dependence, though the country has no operational rare earth production capacity yet.
• Argentina offers $14 billion in verified copper mining investments under RIGI incentives, but rare earth separation capabilities remain unproven despite diplomatic rhetoric.
• Argentina's $14.5B trade relationship with China versus $8.6B with the US complicates its strategic positioning as a non-exclusive rare earth supply chain alternative.

At the inaugural U.S. Critical Minerals Ministerial, Secretary of State Marco Rubio delivered a message designed to resonate well beyond Washington: Argentina, he said, “has the capacity in terms of natural resources … not just for the United States, but for the world.”

Meaning?  The takeaway is simple: the U.S. is looking for partners to reduce dependence on China for minerals critical to technology, defense, and advanced manufacturing—and Argentina is being publicly welcomed into that conversation.

Trump Administration Goal—Tighten Critical Mineral Collaboration

But in rare earths, words are cheap; separations are not.

What Argentina Actually Has—and What It Doesn’t (Yet)

Argentina is unquestionably a heavyweight in lithium, copper, and base metals, with growing institutional credibility under President Javier Milei’s market-oriented reforms. However, commercial rare earth production is another matter.

There are no producing rare earth mines, no established separation plants, and limited publicly disclosed resource data meeting Western reporting standards.

Rubio’s statement, captured by the Buenos Aires Times (opens in a new tab), that Argentina has “expertise in processing” is accurate in mining and metallurgy broadly, but not yet proven at scale for rare earth separations, the true choke point in the supply chain.

This distinction matters. Rare earths are not scarce rocks—they are chemistry problems.

Diplomacy Meets Investment Incentives

Argentina’s Foreign Minister Pablo Quirno (opens in a new tab) struck a more grounded note, emphasizing “clear rules and long-term predictability.” That phrasing aligns closely with investor concerns: permitting, currency stability, capital controls, and contract enforcement—not just geology—determine whether projects get built.

Pablo Quirno, Foreign Minister

Quirno’sannouncement of ~US$14 billion in incoming mining investment underArgentina’s RIGI incentive framework—largely tied to copper projects like El Pachón and MARA—is concrete and verifiable. These are real assets moving toward construction, unlike speculative rare earth narratives.

The China Question, Quietly Loud

China’s dominance in rare earth processing is the unspoken subtext. Argentina’s close economic ties with Beijing complicate the story, even as Buenos Aires signals alignment with Washington. Balancing both powers may be politically rational—but for rare earth supply chains, alignment without exclusivity limits strategic value.

Note Argentina trades significantly more with China than the United States, with China serving as a top import source and major buyer of agricultural goods, while the U.S. remains a key, albeit smaller, partner. In 2023, Argentina's tradevolume with China was roughly $14.5 billion, compared to $8.6 billionwith the U.S.

What’s Notable—and What’s Premature

Notable:

• The U.S. is broadening its critical minerals diplomacy beyond the usual suspects.
• Argentina is positioning itself as a rules-based, investment-friendly jurisdiction.

Premature:

• Treating Argentina as a near-term rare earth supplier without proven resources, separation capacity, or offtake pathways.

REEx Takeaway

Argentina may become important in the rare earth ecosystem—but today it is aspirational, not operational. Investors should separate copper-scale reality from rare-earth rhetoric. Rubio’s remarks are best read as strategic signaling, not a geological verdict.

The story to watch is not what Argentina could supply, but whether it chooses to build the hardest part of the chain. Only time, deal-making, and delivery will tell.

• The U.S. Trade and Development Agency (USTDA) is expanding its strategic role in securing critical minerals access through:
  • Early-stage capital
  • Project development
  • Commercial partnerships
  • Spanning the entire mining lifecycle from exploration to infrastructure
• USTDA announced three major initiatives:
  • Five global critical minerals convenings
  • A copper-cobalt feasibility study in Zambia targeting 25,000 metric tons annually
  • New scoping missions pairing U.S. companies with emerging market opportunities
• Unlike subsidy-focused programs, USTDA:
  • Positions U.S. firms at the front end of global mineral development
  • Funds feasibility studies and validates project economics
  • Creates commercially viable alternatives to China-centric supply chains

As Washington sharpens its focus on supply-chain resilience, the U.S. Trade and Development Agency (opens in a new tab) is expanding its role as one of the federal government’s most practical—and often underappreciated—tools for securing access to critical minerals and rare earth elements.

At theinaugural Critical Minerals Ministerial hosted by the U.S. Department of State, senior U.S. officials delivered a clear message: rebuilding secure mineral supply chains will require more than policy declarations. It will demand early-stage capital, credible project development, and trusted commercial partnerships. This is precisely where USTDA operates.

Secretary Marco Rubio (opens in a new tab), delivering opening remarks in Washington, D.C., framed critical minerals as a foundational pillar of U.S. economic security and national defense—setting the stage for USTDA’s latest programming commitments.

“USTDA’s approach to critical minerals offers our partners a responsible alternative for developing their natural resources while reducing China’s stranglehold on essential supply chains,” said Thomas R. Hardy (opens in a new tab), USTDA’s Deputy Director.

Thomas R. Hardy, USTDA’s Deputy Director

From Geology to Infrastructure: A Full-Cycle Strategy

Unlikeagencies focused narrowly on extraction, USTDA’s critical minerals strategy spans the entire mining life cycle—from exploration and processing to the often-overlooked infrastructure required to bring projects to market, including power generation, rail, and port facilities.

This lifecycle approach reflects a hard-earned reality confronting the United States and its allies: minerals without logistics are stranded assets. By addressing upstream technical work alongside enabling infrastructure, USTDA positions projects for commercial viability rather than perpetual feasibility.

Three Concrete Moves That Matter

1. Global Critical Minerals Events

USTDA will host five international convenings to promote secure, transparent, and diversified critical minerals supply chains. These events will connect U.S. mining companies, technology providers, engineering firms, and infrastructure developers with vetted projects in emerging markets—positioning U.S. firms early, before financing and procurement decisions are locked in.

2. Zambia Copper & Cobalt Feasibility Study

In partnership with Metalex Africa Zambia Limited, USTDA has issued a Request for Proposals for a U.S. company to lead a feasibility study at the Kazozu copper and cobalt project. The study will evaluate expansion potential of up to 25,000 metric tons annually, targeting metals critical to electronics, energy systems, and defense applications. (RFP closes February 17, 2026.)

3. Critical Minerals Scoping Missions

USTDA will fund new scoping missions that pair U.S. companies with high-impact opportunities across emerging markets—helping identify, structure, and de-risk projects spanning exploration, extraction, processing, and supporting infrastructure.

Why This Matters for Investors and Industry

USTDA does not mine, refine, or manufacture. Its influence lies upstream—funding feasibility studies, validating project economics, and shaping bankable pipelines that can later attract private capital, development finance institutions, and strategic offtakers.

In an era defined by efforts to diversify away from China-centric supply chains, USTDA’s model stands out for its emphasis on early intervention with commercial discipline, rather than broad-based subsidies or post hoc bailouts.

Bottom Line

While larger initiatives such as CHIPS and Project Vault capture headlines, USTDA is doing the quieter work of converting policy intent into investable projects. By positioning U.S. firms at the front end of global critical minerals development, the agency is helping ensure that future supply chains are not only secure—but commercially grounded.

For investors tracking the evolution of America’s critical minerals strategy, USTDA’s expanding footprint is a signal worth watching.

• USA Rare Earth secured an unprecedented $1.6B non-binding CHIPS Act framework plus $1.5B PIPE, totaling $3.1B.
• Unlike MP Materials' price-protected structure, it includes no price floors, no guaranteed offtake, and milestone-gated clawback provisions that leave execution risk entirely with shareholders.
• Round Top's ultra-low grade geology (~638 ppm total REE, ~160-200 ppm high-value content) creates a fundamental unit economics challenge where plausible revenue per ton ($12-$15) struggles against all-in processing costs (~$25/ton), making this a chemistry bet amplified by scale rather than a conventional mining play.
• Government equity and warrants (~8-16% dilution) remain permanent even if funding stalls or is clawed back—an asymmetric structure that persists regardless of capital delivery.
• The company must still satisfy complex prerequisites including semiconductor MOUs, NdPr agreements, nuclear licensing, and $250M revolving credit by year-end 2026.

USA Rare Earth has become the most consequential real-world stress test of America’s emerging, state-backed critical-minerals strategy. In late January 2026, the Trump administration advanced a non-binding but unprecedented $1.6 billion financing framework under the Department of Commerce’s CHIPS Program, tied to development of the Round Top project in Texas and an integrated mine-to-magnet supply chain. In parallel, the company closed a $1.5 billion private PIPE, bringing total contemplated capital to $3.1 billion.

Rare Earth Exchanges™ reviews regulatory disclosures delineating risks and opportunities.

Scale matters. This is not Washington’s first intervention in rare earths—but it is its boldest extension. In 2024–2025, the Department of Defense invested roughly $400 million in preferred equity and warrants in MP Materials, alongside a $150 million DoD loan, a structure widely understood to include effective NdPr price-floor protection (~$110/kg). That architecture materially reduced downside risk.

USA Rare Earth’s structure does not. MP has also secured access to $1 billion via Golden Sachs and Morgan Stanley, and to a half-billion-dollar magnet recycling project with Apple.

With USA Rare Earth, there are no price floors, no guaranteed offtake, and no revenue backstops. Execution risk sits squarely with the company and its shareholders.

Layered above this is Project Vault, a proposed $12 billion strategic critical-minerals stockpile, seeded with $10 billion from the U.S. Export-Import Bank and $2 billion in private capital. The macro signal is unmistakable: Washington is prepared to act as a financier, equity participant, and—implicitly—a market stabilizer.

That is the policy layer.

What follows is the ore, the chemistry, and the contracts.

What the SEC Disclosure Says: The Deal, Without the Gloss

USA Rare Earth’s January 26, 2026, Form 8-K and Exhibit 99.1 are unusually explicit in laying out contingencies.

Capital Stack (as filed)

• $277 million in proposed CHIPS Act direct funding
• $1.3 billion senior secured loan, 15-year tenor, expected pricing Treasury + ~150 bps
• $1.5 billion PIPE, 69.8 million shares at $21.50 (closed January 28, 2026)

Government Equity Economics

• 16.1 million common shares issued at an implied $17.17/share
• ~17.6 million warrants, $17.17 exercise, 10-year term
• Effective government ownership: ~8%–16% fully diluted (pre-PIPE), depending on warrant exercise

The asymmetry is critical: government equity and warrants remain outstanding even if funding is delayed, reduced, or clawed back. This is not cosmetic dilution—it is structural.

Conditions First, Capital Later

Before definitive agreements are executed, USA Rare Earth must satisfy a long list of prerequisites, including:

• Raising ≥ $500 million in non-federal capital (now satisfied via PIPE)
• Securing two MOUs from semiconductor end- or mid-stream users
• Locking NdPr oxide and MREC feedstock agreements through 2027
• Exercising a Texas GLO surface-purchase option
• Completing third-party nuclear-licensing validation at the Wheat Ridge lab
• Defining a power-infrastructure plan for the Stillwater magnet facility

Failure on any single condition can halt the transaction before funds are drawn.

Milestone-Gated Cash: Industrial Finance, Not Venture Capital

Unlike MP Materials’ price-protected structure, every dollar of USA Rare Earth’s government funding is milestone-released and clawback-exposed.

Round Top (Dec 2026–Dec 2028):

• Definitive feasibility study
• Early works
• Solvent-extraction completion
• Construction completion

Metals & Alloy (Mar–Dec 2027):

• Technical feasibility
• Commercial qualification

Magnet Manufacturing (Jun 2026–Mar 2028):

• Initial production and demandvalidation
• Incremental capacity and demand validation

Miss a milestone → funding does not release.

Miss final milestones by more than two years → prior funding may be clawed back.

Meanwhile, the company must still:

• Fund ~$4.1 billion total capex
• Establish a $250 million revolving credit facility by Dec 31, 2026

This is performance-contingent industrial finance, not patient capital.

What Holds—and Where the Squeeze Tightens

Several core critiques remain intact:

• Round Top is geologically massive but ultra-low grade, consistent with prior technical disclosures. Potential challenges include extraction, refining, and processing at scale and economy.
• The mine plan depends on heap leaching plus complex downstream separation, historically a failure-prone pathway.
• The Less Common Metals (LCM) acquisition is real and strategically valuable for midstream alloy capability.

Important nuance matters:

• USA Rare Earth has produced an initial batch of NdFeB magnets (January 2025). That milestone matters—but it does not establish repeatability, qualification, or revenue.
• MP Materials’ support was not a simple equity injection—it combined preferred equity, warrants, loans, and effective price protection, fundamentally altering risk allocation.

Round Top’s Core Challenge: “Good-Stuff ppm” Economics

Round Top’s vulnerability is not geological existence—it is economic density.

Illustrative, conservative math:

• 638 ppm total REE (0.064%)
• If ~75% is Ce/La, higher-value content ≈ 160–200 ppm
• Plausible in-situ basket value: $12–$15 per ton,pre-recovery

Against:

• Mining, crushing, heap leaching
• Acid and reagent logistics
• Solution handling and impurity removal
• Solvent extraction into saleable oxides (the costliest step)

Even optimistic cases struggle to keep all-in processed-rock costs below ~$25/ton. When revenue per ton is structurally lower than cost, scale amplifies losses.

Round Top has always been a chemistry bet wearing a mining label.

Complexity Is Not Free Diversification

USAR’s strategy—REEs plus lithium, gallium, zirconium, hafnium, and more—adds optionality. It also adds:

• New circuits
• New QA specifications
• New waste streams

Without long-duration continuous pilot runs, independently validated recoveries, and customer-accepted specifications, “we monetize everything” becomes execution-risk stacking, not diversification.

LCM Helps—But It Doesn’t Change the Rock

LCM meaningfully reduces midstream risk and gives the West rare alloy-making capability. It does not convert low-grade rhyolite into a high-margin orebody. Until Round Top produces oxides economically, LCM de-risks one link, while the hardest link remains unresolved.

Magnets: Real Progress, No Free Pass

Stillwater is real. Initial production has occurred. What remains unproven:

• Repeatability
• Yield
• Specification compliance
• Customer qualification

Here again, structure matters: no guaranteed offtake, no price floor. Demand validation itself is a funding milestone.

The Risk Many Investors Miss: Asymmetric Dilution

Per the SEC disclosure:

• Government equity and warrants do not unwind if funding stalls or is clawed back
• Dilution persists even without cash

This asymmetry is rare in U.S. mining finance—andmaterial.

What Real De-Risking Looks Like (Next 12–24 Months)

To transition from policy emblem to investable industrial asset, USA Rare Earth must deliver:

• DFS-level economics, not PEAs
• Full elemental distribution disclosure
• Continuous demonstration-plant mass-balance data
• Repeatable, customer-qualified magnetruns
• Clear articulation of price-risk mitigation relative to MP-style protection

Bottom Line

USA Rare Earth is strategically necessary per the federal government, but necessity does not repeal physics. Government equity can buy time. Stockpiles can smooth demand. Neither can rescue negative unit economics.

REEx supports building ex-China supply chains with discipline. The ask remains simple:

• Show the mass balance.
• Show the costs.
• Show the specs.
• Then celebrate.

Until then, this remains one of the most ambitious—and financially conditional—industrial-policy bets in modern U.S. mining history. America and the West need a successful USA Rare Earth, and there is work to do.

• The Trump administration announced a preferential critical minerals trade bloc featuring reference prices, enforceable price floors, and adjustable tariffs to counter China's dominance and stabilize volatile commodity cycles that prevent Western projects from securing financing.
• Vice President JD Vance and Secretary of State Marco Rubio framed the initiative as essential infrastructure for the AI economy and national security, positioning it as a new trade architecture era rather than just subsidies or permits.
• Project Vault, backed by a $10 billion Export-Import Bank loan with participation from major OEMs like Boeing and GE Vernova, aims to create demand scaffolding that derisks refineries and processing capacity, though implementation challenges around rules of origin, pricing complexity, and enforcement remain unresolved.

On February 4, 2026, the State Department’s inaugural Critical Minerals Ministerial began with a deliberately cinematic pairing: Vice President JD Vance as the keynote “closer,” and Secretary of State Marco Rubio as the host framing the room’s mission—treating critical minerals not as a niche commodity story, but as the material base layer of industrial power, defense readiness, and the AI economy. Reuters and AP both reported the same core reveal: the Trump administration is pushing a preferential critical-minerals trade bloc featuring reference prices and enforceable price floors—backstopped by adjustable tariffs—as a counterweight to China’s dominance and to the whiplash price cycles that keep Western projects from reaching financeable final investment decisions.

Rare Earth Exchanges™ reports on this important event organized by the Trump administration. Note, we will follow up later today with articles inclusive of statements by U.S. supply chain players.

Vance’s opening move was to shift the audience from abstraction to gravity. He tied critical minerals to the “real economy”—the idea that data centers and software still depend on mined and refined inputs—then pivoted to a market diagnosis: supply chains “brittle and exceptionally concentrated,” asset prices “persistently depressed, and an investment pattern where projects die “on the vine” after sudden supply surges collapse prices. In other words, the market isn’t merely volatile; it is strategically gameable, and the West keeps losing the financing cycle.

That framing matters because it sets up the administration’s most aggressive claim: this isn’t a “more permits” or “more subsidies” era. It’s a new trade architecture era.

Vance’s Core Pitch: A Minerals “Trade Zone” With a Price Floor—Industrial Policy in Tariff Form

Vance described an alliance-scale mechanism: members would trade critical minerals inside a preferential zone with reference prices acting as a floor, enforced by adjustable tariffs to prevent undercutting by low-priced imports. This represents an effort to stabilize prices and incentivize private investment—accepting that the cost of stability may be higher near-term prices, but arguing that the cost of instability is no mines, no refineries, no magnets.

If you’re an investor or operator, you can hear the subtext: this is an attempt to manufacture bankability. In mining and processing, “great geology” is not enough; what matters is whether a project can clear long-duration capital under commodity cycles. A credible floor turns a fragile pro forma into something lenders can underwrite.

Vance then stitched the pitch to recent actions: Project Vault, branded as a domestic critical-minerals stockpile initiative, was presented as the parallel backbone—demand signal + inventory strategy—while the trade zone would be the price-and-flow discipline. Reuters and AP both linked the ministerial messaging directly to Project Vault’s scale.

Rubio’s Frame: “Economic Security Is National Security”—And the Mountain Pass Parable

Rubio’s remarks—less mechanistic, more historical—worked like a guided tour through America’s industrial amnesia. He argued the U.S. once mined and produced critical mineral derivatives (including rare earth magnets), cited Mountain Pass as emblematic, and told the story many advanced economies know too well: outsource the “unfashionable” steps, celebrate design, then wake up dependent.

His most strategic analogy was the overt callback to the Washington Energy Conference of the 1970s and the creation of the International Energy Agency—a signal that the administration wants a minerals-era equivalent of coordinated energy security: shared rules, shared stockpiles, shared resilience. (That comparison is conceptually powerful—though operationally harder—because minerals are multi-material, multi-stage, and far less fungible than crude oil.).

Rubio also anchored the summit in a broader diplomatic scaffolding that already exists: Pax Silica, a State Department-led initiative launched in December 2025, focused on securing a silicon supply chain and the upstream inputs the AI era runs on.

The Money Signal: Project Vault and the Question of “Who Actually Buys?”

Project Vault is not just a stockpile headline; it is being sold as a market-making device. The U.S. Export-Import Bank said its board approved a direct loan of up to $10 billion to Project Vault and listed early “indications of participation” from major OEMs (including names such as Boeing and GE Vernova) along with commodity suppliers and traders.

That detail—OEM participation—may be the most important line in the whole rollout. Stockpiles without offtake logic can become political warehouses. Stockpiles tied to industrial procurement can become demand scaffolding that derisks refineries, alloying, and magnet capacity.

The Geopolitical Backdrop: China Leverage, Market Power—and a Freshly Hardened U.S. Posture

The summit’s urgency sits inside a wider escalation cycle. This ministerial, frankly, is part of Washington’s effort to weaken China’s grip on critical minerals and reduce supply-chain vulnerability.

This is not a minor point: the administration is narrating minerals policy as a national-security instrument, not merely an economic development program. That framing will attract allies who share threat perceptions—and repel partners wary of being drafted into a new bloc logic.

What’s Real, What’s Rhetoric, What’s Missing

What emerges as broadly credible is the administration’s core diagnosis of market failure. The pattern in which promising mining or processing projects collapse when prices suddenly crater is well documented across lithium, rare earths, and other strategic materials, and it remains one of the central reasons Western efforts to diversify supply chains have repeatedly stalled. In that light, the idea of pairing a price floor with tariff-based enforcement is not radical so much as corrective: in theory, it could stabilize investment conditions and make long-duration capital viable again—if enforcement is airtight and participation is deep enough to prevent arbitrage.

What remains unresolved, however, is where theory meets operational reality. Which minerals will qualify, at which stages of the value chain, and under what reference prices? Vance spoke of floors “at each stage of production,” but the complexity is immense: concentrates, oxides, metals, and finished products like magnets are distinct markets with different bottlenecks and pricing dynamics.

Equally thorny is the risk of “China-in-the-middle” laundering—an issue even sympathetic observers have flagged—where low-cost Chinese material could be rerouted through third countries unless rules of origin, traceability, and enforcement are exceptionally strict. And finally, there is the political test: while U.S. officials say roughly 30 countries have expressed interest in joining a critical minerals club, interest is not the same as accession.

Signing on means accepting pricing discipline and tariff guardrails, a step that many allies may hesitate to take once domestic politics and trade sensitivities come into play.

The investor takeaway

This summit wasn’t a ribbon-cutting. It was a declaration that the administration wants to replace commodity fatalism with engineered stability—a deliberate attempt to turn critical minerals into an allied, rules-based industrial commons. And it’s about time.  If they can execute on enforcement and procurement and avoid excessive government entanglement (e.g., nepotism), especially via Project Vault, this could re-rate the financeability of midstream and downstream assets. If they can’t, it becomes another grand doctrine that breaks on the rocks of implementation.

• Shenghe Resources completed full acquisition of Peak Rare Earths, gaining control of Tanzania's Ngualla rare earth project, while advancing African zirconium-titanium assets as part of an overseas expansion strategy.
• The company launched an upgraded compliance framework and export control training, signaling adaptation to heightened global scrutiny of Chinese critical mineral operations.
• Shenghe positions zirconium-titanium projects as a 'second growth curve' alongside rare earths, broadening critical minerals portfolio to hedge price cycles and leverage shared infrastructure.

On January 29–30, Shenghe Resources held its 2025 Annual Meeting in Chengdu under the theme “Shared Prosperity, Global Reach.” The meeting reviewed the 2025 performance of all business segments and subsidiaries and examined the annual work report delivered by the company’s General Manager.

The meeting provided a comprehensive summary of the company’s performance in 2025. It noted that Shenghe closely tracked market trends, seized opportunities, and achieved major progress in operating results, institutional development, and overseas business expansion. The company highlighted achievements in technological innovation, optimization of internal and external operating environments, and deeper integration of business units and organizational structures.

Following a smooth leadership transition last year, Shenghe focused on improving governance and accelerating overseas project development. The company completed the full acquisition of Peak Rare Earths, thereby gaining control of the Ngualla rare earth project in Tanzania, while making steady progress on African zirconium–titanium projects. Internally, Shenghe promoted organizational integration, increased internal talent mobility, strengthened regional coordination mechanisms, and enhanced talent support systems.

The company emphasized continued reinforcement of compliance and risk management, establishing a comprehensive compliance framework. It also advanced digitalization and information systems to support intelligent command and scientific decision-making. Shenghe further stressed the importance of market capitalization management and proactive engagement with capital markets.

Chairman Xie Bing stated that the company must fully recognize both opportunities and challenges, rigorously assess strengths and weaknesses, strictly adhere to national industrial policy, and strengthen policy research and on-the-ground assessments. He emphasized addressing management and talent-development gaps, maintaining steady progress in rare earths, accelerating zirconium–titanium projects, rapidly advancing overseas assets, and opening a “second growth curve.”

The meeting also set out key priorities for 2026 and included the launch of an upgraded compliance management system, export control compliance training, and a ceremony recognizing outstanding teams, managers, and employees for 2025. Senior management, including Chairman Xie Bing, Vice Chairman and CEO Huang Ping, and Overseas Division Chairman Wang Quangen, attended.

REEx: What The Update Informs Investors

Three signals matter for rare earth watchers outside China:

1. Overseas Control Is Now Central, Not Peripheral. The explicit emphasis on Peak Rare Earths and control of Tanzania’s Ngualla project confirms Shenghe’s strategy of locking in upstream optionality offshore—especially in jurisdictions Western firms also view as diversification targets.
2. Compliance Language Is Not Accidental. The repeated references to export-control training and compliance frameworks reflect real pressure. Chinese rare earth firms now operate under tighter global scrutiny, and Shenghe is signaling readiness to operate within—and influence—those rules.
3. Zirconium–Titanium as a Second Growth Curve. Shenghe is openly positioning zirconium–titanium projects alongside rare earths, indicating a broader critical-minerals portfolio that could hedge rare earth price cycles while leveraging shared processing and logistics.

REEx Takeaway

This is not just an annual pep rally. Shenghe is consolidating overseas assets, professionalizing compliance, and broadening its mineral base—moves that reinforce China-linked influence across multiple critical mineral chains.

Disclosure & Verification Notice

This material includes a translation of company-issued content distributed via WeChat and state-affiliated channels. Statements reflect Shenghe Resources’ own reporting and should be independently verified.

• India is positioning itself as a strategic U.S. partner in securing critical minerals.
• India's 2026-27 budget is committed to developing rare earth corridors focused on separation, processing, and magnet manufacturing, not just extraction.
• The U.S. is supporting this shift with a $12 billion strategic stockpile (Project Vault) and $3.8 billion in rare earth investments.
• Supply security emphasizes the need for trusted processing capacity, not just mineral access.
• India's strengths in engineering and manufacturing are significant, but success will be measured in tonnage processed and magnets shipped, not merely diplomatic agreements.

India is being positioned as a key partner in U.S. and allied efforts to secure critical minerals and reduce reliance on China. Experts say this move is timely—but success depends on whether India can build real processing and manufacturing capacity, not just sign agreements or mine more ore.

USA and India  Makes Sense

According to reporting by ANI, India’s participation in U.S.-led critical minerals frameworks reflects a shift from diplomatic intent to industrial execution. Benchmark Mineral Intelligence’s Neha Mukherjee accurately notes that India’s 2026–27 budget commitment to dedicated rare earth corridors signals a move beyond extraction toward separation, processing, magnet manufacturing, and downstream capability—the true choke points of the rare earth value chain.

The report correctly situates this momentum within a broader allied push, including the upcoming U.S.-hosted Critical Minerals Ministerial and Washington’s launch of a $12 billion strategic critical minerals stockpile (Project Vault). These steps underscore a shared recognition: supply security now hinges on trusted processing and stockpiling, not just access to rocks.

Where the Optimism Runs Ahead of Reality

Recent news out of India leans optimistic.  While India’s ambitions are real, timelines are long. Building separation plants, qualifying magnet-grade output, and scaling manufacturing take years—not budget cycles. The report also highlights U.S. investment of $3.8 billion across the rare earth value chain, but does not parse how much of that targets midstream processing versus early-stage projects.

There’s also a subtle diplomatic gloss. Initiatives like Pax Silica—a U.S.-led effort to secure AI and semiconductor supply chains—sound comprehensive, yet remain policy scaffolding. Execution risk is high without aligned standards, bankable offtakes, and predictable permitting.

Why This Matters for the Rare Earth Supply Chain

India’s comparative advantage is not geology alone; it’s scale, engineering talent, chemicals expertise, and manufacturing depth. As Rare Earth Exchanges™ has chronicled, India could emerge as a leader in key areas of the rare earth supply chain, including recycling and non-rare earth motor technology, for example. But the Indian government has sought to be more proactive with a comprehensive industrial policy.

So if paired with allied capital and guaranteed markets, India could credibly host separation and magnet facilities that diversify supply away from China. If not, partnerships risk becoming symbolic.

REEx Takeaway: This is a necessary pivot—from speeches to supply chains—but success will ultimately be measured in tonnage processed and magnets shipped, not memoranda signed.

Source: ANI, (opens in a new tab) Feb. 4, 2026

• The European Union proposes a Strategic Partnership Roadmap with the U.S. on critical minerals.
• The aim is to reduce dependence on Chinese supply through:
  • Joint sourcing
  • Price-support mechanisms
  • Coordinated trade tools
  • Shared stockpiling within three months
• This proposal addresses market design by focusing on:
  • Pricing mechanisms
  • Premium markets
  • Standards-based trade
• The recognition that rare earth bottlenecks exist in processing, refining, and qualification rather than extraction alone.
• Success depends on whether diplomatic coordination leads to actual midstream refining capacity and bankable offtakes.
• Emphasis on avoiding mere memoranda, stockpiles, or price floors that don't create processing infrastructure.

Is the European Union proposing a critical minerals partnership with the United States, separating credible policy advances from familiar diplomatic optimism? What’s new here? What’s recycled, and why midstream realities—not memoranda—will decide whether this effort alters rare earth supply chains.  Rare Earth Exchanges™ reports that the European Union will likely pitch the U.S. on a new critical minerals partnership aimed at reducing dependence on Chinese supply. What will be inherent in such a deal? Joint sourcing?  Price support? Stockpiles? And what about shared rules? It sounds ambitious—but similar efforts have failed before. Whether this one matters depends on execution, not potential headlines in the days to come.

What’s Actually on the Table

According to officials familiar with the talks, the European Union is ready to sign a memorandum of understanding with the United States to develop a “Strategic Partnership Roadmap” on critical minerals within three months. Negotiators hope to conclude talks within 30 days, alongside a broader U.S.-led push with allied nations. Rare Earth Exchanges has repeatedly reported that traditional allies of “the West” would need to form tight alliances to overcome China’s predominance in the supply chain.

As cited in The Japan Times (opens in a new tab) a potential proposal could include joint sourcing projects, price-support mechanisms, coordinated trade tools (such as price floors and offtake agreements), shared stockpiling, and exemptions from each other’s export controls. It also calls for coordinated responses to market manipulation and oversupply—code words for shielding Western producers from cheaper Chinese material.

What’s New—and What Isn’t

The novelty lies less in intent than in scope. Previous efforts focused on mining. This proposal gestures toward market design—pricing mechanisms, premium markets, and standards-based trade. That’s directionally correct: rare earth bottlenecks live in processing, refining, and qualification, not just extraction.

What’s familiar is the optimism. Multiple U.S. administrations and EU initiatives have promised diversification “within months,” only to collide with permitting delays, capital costs, and Chinese midstream dominance. Officials themselves acknowledge skepticism that a substantive deal can be finalized quickly.

The Political Subtext Investors Shouldn’t Miss

The memorandum reportedly includes language on respecting territorial integrity—an unusual insertion linked to recent tensions after President Trump floated the idea of acquiring Greenland, a territory of the EU member state Denmark. This highlights a recurring challenge: mineral diplomacy is now inseparable from geopolitics.

Meanwhile, Washington’s launch of a $12 billion critical-mineral stockpile echoes the EU's interest in buffering against supply shocks. Stockpiles can buy time—but they do not create refining capacity.

Why This Matters for Rare Earth Supply Chains

The proposal correctly identifies the problem—dependence on Chinese material—but risks repeating an old mistake: treating coordination as capacity. Without aligned standards, shared qualifications, bankable offtakes, and real midstream investment, price floors and memoranda won’t move molecules.

REEx Takeaway: This effort shows smarter thinking—markets, not mines—but success hinges on whether rules translate into refineries. We’ll learn more this week.

• Investors are pouring capital into AI and data centers while dramatically underfunding the mines and processing plants that supply the critical minerals these technologies require, creating a dangerous mismatch.
• Mining investment has grown only marginally since 2015 despite soaring AI valuations, and with 10-20 year development timelines, today's underinvestment raises material supply shortage risks in the 2030s.
• Rare earths represent the bottleneck within the bottleneck—essential for EVs, wind turbines, data centers, and defense—yet processing remains highly concentrated as capital favors software over supply chains.

This Rare Earth Exchanges (REEx) analysis reviews “The Paradox of Visibility,” a 2026 white paper from Resource Capital Funds (opens in a new tab), which argues that capital markets are misallocating investment—overfunding artificial intelligence and digital infrastructure while underfunding the critical minerals those systems physically require. We assess what is well supported, where assumptions deserve caution, and why this imbalance matters for rare earth and critical mineral investors.

Overview

A new analysis argues investors are pouring money into AI and data centers while ignoring the mines and processing plants that supply the metals making those technologies work. This mismatch could create shortages, higher prices, and geopolitical risk—especially for rare earth elements.

What the Paper Gets Right

The paper’s central insight is hard to dispute: the digital economy is not abstract—it is material-intensive. AI, hyperscale data centers, electrification, and advanced manufacturing all depend on copper, rare earth elements, lithium, nickel, graphite, aluminum, and silver. These inputs are dictated by physics, not preference.

Resource Capital Funds documents how electricity demand from AI workloads and data centers could more than double by the early 2030s, driving unavoidable demand for copper-heavy grids, rare-earth-based motors, and battery systems—while global mining investment remains well below levels consistent with that growth.

Where the Evidence Is Strongest

The most persuasive section compares financial valuation versus physical investment. While leading AI and compute platforms have seen rapid valuation growth since 2015, capital spending by the world’s largest miners has grown only marginally over the same period.

Given 10–20-year mine development timelines, today’s underinvestment materially raises the risk of supply tightness in the 2030s.

The paper is also clear-eyed about alternatives: recycling, substitution, and efficiency gains help—but cannot resolve near-term deficits within policy-relevant timelines.

Where Investors Should Apply Judgment

The analysis leans toward a structural scarcity narrative. Directionally, that risk is real—but outcomes will vary by commodity, jurisdiction, and project stage. Policy reform, permitting acceleration, or price shocks could change timelines. Investors should read the paper as a risk framework, not a deterministic forecast.

Why This Matters for Rare Earths

Rare earths are the bottleneck within the bottleneck. High-performance magnets underpin EVs, wind turbines, data-center cooling, and defense systems, yet processing and separation remain highly concentrated. If capital continues to favor software over supply, rare earth scarcity will assert itself through price, policy, and geopolitics.

REEx Takeaway: The digital economy may feel weightless—but it runs on metal. A capital that ignores that reality risks funding the future while starving its foundation.

Source: Resource Capital Funds, The Paradox of Visibility (2026)

• Northern Rare Earth Group is diversifying rare-earth applications beyond traditional materials into:
  • Healthcare
  • Textiles
  • Agriculture
  • Hydrogen energy
• Developed nearly 10 specialized compounds and over 30 solid-state hydrogen storage materials in 2025.
• Filed 158 patent applications in 2025.
• Led or participated in 69 standards in 2025.
• Involved in work on international standards for praseodymium-neodymium metal, critical for EV and wind turbine magnets.
• Demonstrated commercialization of a hydrogen-powered two-wheel vehicle using solid-state storage, achieving:
  • 90+ km range
  • Zero emissions
• Showcased cross-sector innovation from lab to market.

A major rare-earth producer based in Inner Mongolia reports rapid progress in expanding rare-earth applications beyond traditional materials into healthcare, textiles, agriculture, and hydrogen energy—signaling a deliberate push to move the industry up the value chain through cross-sector innovation, standards leadership, and faster commercialization of R&D.

According to a February 3, 2026 report from Baotou News Network, Northern Rare Earth Group says it used reforms to its R&D–production–sales model in 2025 to optimize product mix and accelerate commercialization. The company reports development of nearly 10 rare-earth compounds tailored to specific end markets and more than 30 solid-state hydrogen storage materials, while expanding “Rare Earth + Healthcare,” “Rare Earth + Textiles,” and “Rare Earth + Agriculture” use cases.

The company frames technology as its core growth engine. In 2025, it claims to have solved two core technical challenges, launched six new products, developed three new processes and four new equipment systems, and advanced six pilot demonstration lines, aiming to turn laboratory advances into scalable industrial output.

Standards and IP as Competitive Levers

The report emphasizes the growing influence of global standards. At the September 2025 meetings of ISO/TC 298 (Rare Earth Technical Committee), the company tracked seven active standards, initiated eight new projects, and advanced three new proposals. Notably, it is leading work on an international standard for praseodymium-neodymium (Pr-Nd) metal, a critical input for permanent magnets used in EVs, wind turbines, and defense systems.

In 2025, the firm says it filed 158 patent applications (including one international invention patent and 125 domestic invention patents) and participated in 69 standards, with leadership roles in roughly 34% of national and industry standards—a signal of growing rule-setting ambition, not just production scale.

From Lab to Market

Commercialization is demonstrated by a hydrogen-powered two-wheeled vehicle developed by a subsidiary, now in internal use. The vehicle uses an in-house solid-state hydrogen storage canister that holds 80–90 grams of hydrogen, delivering a range of over 90 kilometers, zero tailpipe emissions, and strong cold-weather performance.

The company also reports building a multi-layered innovation platform spanning basic research, applied technology, pilot production, and industrial deployment—supporting EVs, aerospace, advanced textiles, and micro-motor systems.

Western POV

The update underscores a broader pattern: rare earths are being repositioned as enabling technologies across multiple industries, not just mining outputs. Leadership in standards, IP, and cross-sector applications could translate into downstream leverage over magnets, hydrogen systems, and specialty materials—areas where Western supply chains remain exposed.

Disclosure & Verification Notice: This article is a translation and summary of a state-owned regional media outlet (Baotou News Network). All claims reflect company and government statements and should be independently verified. Performance metrics and technology outcomes may emphasize strategic positioning aligned with national industrial policy.

• China installed a 20-MW offshore wind turbine in Fujian—the largest in real marine conditions—with fully domestic components, proprietary blade designs, and 20%+ weight reduction that lowers foundation costs.
• Advanced AI-driven forecasting and failure prediction by companies like Envision Energy deliver ~8% higher generation and 20%+ better wind-farm economics across harsh environments.
• Despite leading global wind deployment, China's electricity mix remains ~60% coal-dependent, giving it strategic control over clean-energy manufacturing and rare-earth magnets while maintaining thermal baseload.

China is signaling a new phase in wind power: bigger offshore machines, deeper domestic sourcing, and more AI-driven reliability. A Feb. 3, 2026 report carried by the China Rare Earth Industry Association from People's Daily highlights the installation of a 20-MW offshore turbine in Fujian, described as the largest single unit yet installed in real marine conditions. The report says key components are fully domestically sourced, blades use proprietary airfoil designs, and lightweight engineering cuts per-MW weight by over 20%, lowering installation difficulty and foundation costs—claims that underscore China’s push to industrialize the entire clean-energy stack.

Bigger Turbines, Smarter Software

Beyond size, the article emphasizes “smart and reliable” wind across the lifecycle. It cites carbon-fiber blade progress and highlights Envision Energy using weather/energy models to improve forecasting and predict failures earlier—reported gains include ~8% higher generation and 20%+ better wind-farm economics. It also points to expansion into harsh environments: high-altitude Tibet, floating offshore platforms, and wind-to-hydrogen/ammonia/methanol integration. These are meaningful signals of China’s scale advantage and its ability to blend manufacturing with digital operations.

Reality Check: China’s Power Still Leans Heavily on Coal

Investors should keep the energy denominator in view. In China’s electricity mix, coal still supplies about ~60% of generation, while renewables are roughly ~35%, with nuclear and natural gas playing smaller roles; oil is negligible in power generation. In other words, China can lead the world in wind and remain coal-anchored—because grid stability, industrial demand, and provincial energy security still favor thermal baseload. Recent reporting also notes that “thermal power” (mostly coal) only began showing signs of annual decline in 2025, underscoring how gradual the transition remains.

Why This Matters for the West

Wind is not just “green power.” It is a rare-earth magnet and advanced materials industry wearing a climate badge. China’s edge comes from combining turbine scale, domestic supply, AI optimization, and downstream manufacturing muscle—advantages that compound even when coal remains dominant. For the U.S. and allies, the strategic risk is clear: China can decarbonize selectively while still controlling the industrial inputs—especially magnets—that the West needs for electrification and defense.

Disclosure & Verification Notice: This item is translated and summarized from Chinese state-owned media (People’s Daily) distributed via an industry association. Performance and market-share claims should be independently verified and may reflect industrial-policy messaging.

• Major 2025 milestones achieved by China Northern Rare Earth Group:
  • 158 patent filings
  • Leadership in ISO rare-earth standards
  • Breakthroughs in biological recovery and recycling technologies
• Expansion beyond mining into downstream applications, including:
  • EV components
  • Hydrogen storage
  • Aerospace materials
  • Cross-sector innovations in medical, textile, and agricultural uses
• Strategic push into standards, IP, and advanced processing widens the competitive gap with Western supply chains
• Signals China's ambition to control the entire rare earth value chain

China Northern Rare Earth Group (part of state-owned Baogang Group) reports significant progress in technology development, standard-setting, and commercialization, underscoring Beijing’s continued push to tighten control not just over rare-earth mining, but over advanced processing, materials science, and downstream applications that matter directly to global supply chains.

According to a February 3, 2026 report from Baogang Group media, the state-owned rare-earth giant says it solved two “core technologies” in 2025, launched six new products, developed three new processes, and deployed four new equipment systems, while advancing six demonstration production lines. The company frames innovation as its central growth engine, explicitly linking R&D output to industrial competitiveness.

Downstream Innovation = Patents

A key focus is standards and intellectual property leadership. Northern Rare Earth states it is actively shaping international rare-earth standards through ISO/TC 298, including leading work on an international standard for praseodymium-neodymium (Pr-Nd) metal—a critical input for permanent magnets used in EVs, defense systems, and industrial motors. In 2025 alone, the company claims 158 patent filings (including 125 invention patents) and leadership roles in roughly one-third of China’s national and industry rare-earth standards.

On the technology front, the company highlights progress in rare-earth recycling, bio-metallurgy, micro-motor systems, and functional materials, including pilot production lines targeting EVs, aerospace, advanced textiles, and magnetostrictive acoustic devices. Of particular note is its claimed breakthrough in biological recovery of rare earths from tailings and waste, a capability with potential cost and environmental advantages over conventional processing.

Taking to Market

Northern Rare Earth also showcased commercialization efforts, including a hydrogen-powered two-wheel vehicle using a solid-state hydrogen storage canister developed by its subsidiary. The company claims the system enables long-range, cold-weather performance and zero emissions—signaling ambitions beyond rare earths into adjacent energy technologies.

Strategically, the company emphasizes expanding cross-sector applications such as “rare-earth medical,” “rare-earth textiles,” and “rare-earth agriculture,” while preparing for China’s next five-year planning cycle with deeper integration of R&D, manufacturing, and global innovation networks.

Why this matters for the West

The update reinforces a critical reality: China is certainly not standing still. It is consolidating power not only in refining and magnets, but in standards, IP, recycling, and advanced materials, areas where the U.S. and allies remain structurally behind. For Western supply chains, this widens—not narrows—the competitive gap. This “owning the future” downstream raises significant concerns Rare Earth Exchanges™ continues to chronicle.

Disclosure & Verification Notice: This article is translated and summarized from Baogang Group–affiliated, state-owned Chinese media (Baogang Daily). Claims should be independently verified. Performance metrics, patents, and “breakthroughs” are company-reported and may reflect strategic messaging aligned with national industrial policy.