Rare earth elements explained – why these 17 minerals matter for energy, tech, and security

(Part 1 of 2)

Key takeaways

• Rare earth elements (REE) are not geologically rare, but commercially viable deposits are – making economic extraction difficult and highly concentrated.
• China dominates the REE value chain, producing 68% of global output and controlling ~90% of global refining capacity.
• Global production has surged, rising from 64,500 tonnes in 1994 to ~394,000 tonnes in 2024. Growth from 2023 to 2024 was driven largely by the U.S., China, Nigeria, and Thailand.
• REEs are deemed critical minerals in the U.S. and EU due to their irreplaceable roles in magnets, EVs, wind turbines, defence systems, and consumer electronics – and because supply chains are highly vulnerable to disruption.
• China’s dominance has built-in fragility: despite leading the industry, it relies heavily on REE imports – especially from Myanmar – creating a potential single point of failure in its own supply chain.

Rare earth elements have become a hot topic again due to China’s recent trade action curbing exports in tariff tensions with the United States. In April 2025, exports of seven heavy rare earth elements and related products were restricted in response to tariffs from the U.S. Six months later, the list of controlled items would expand to include five rare earth metals and specialist equipment for refining rare earths.

This was not the first time for such action. China imposed export restrictions with Japan in 2010 and implemented wider export quotas from 2012 to 2014. Given the importance of REE for applications in electricity generation and consumption, defence, and consumer electronics, the current restrictions pose a significant risk to countries dependent on China for their REE supply.

This article connects the dots from what REE are, through to the process of their production, and how China came to play a dominant role in their global supply.

Demystifying rare earths

There are 17 rare earth elements that are found in the Periodic Table. Contrary to what the name suggests, these REEs are relatively abundant in Earth’s crust. The qualification of the elements as “rare” refers to how unusual it is to find them in high enough concentrations to make development economically feasible – particularly so if stringent mining laws and environmental programs are factored into development.

Table 1 – List of rare earth elements ordered by their atomic numbers. (Source: Can You Name All 17 Rare Earth Elements?)

Promethium* (Pm, 61) is usually not included in the list of REE because it is rare and unstable, and scandium** (Sc, 21) does not occur in economic concentrations in the same geological settings.

Based on their atomic numbers, these REEs are grouped into two categories:

1. Light REE (LREE) are more common and include lanthanum (57), cerium (58), praseodymium (59), neodymium (60), promethium (61), samarium (62), europium (63), and gadolinium (64).
2. Heavy REE (HREE) are rarer and include terbium (65), dysprosium (66), holmium (67), erbium (68), thulium (69), ytterbium (70), and lutetium (71).

LREEs include elements with atomic numbers 57-63, while HREEs encompass those with atomic numbers 64-71.

Scandium and yttrium have atomic numbers of 21 and 39, respectively, and so are neither classified as light or heavy. However, they are still labeled as REEs, because they have similar chemical properties, and they are found as ores.

Figure 1 – Periodic Table highlighting rare earth elements; 13 of the 17 REEs are found in electronics. (Source: Rare Earth Elements And Electronic Components: Your Questions Answered)

The properties exhibited by REEs make them especially useful to modern life. The snapshot of the Periodic Table shown in Figure 1 illustrates how important they are in electronics, for example. Thirteen of the 17 REEs are found in electronics equipment – all except promethium, dysprosium, thulium, and lutetium.

Driving home the importance of the REEs, neodymium is indicated as having limited availability with its future supply at risk according to the Periodic Table in Figure 1.

The properties of REE that make them indispensable in the modern economy:

1. High magnetic susceptibility: REE metals are easily magnetized when they come within an external magnetic field – this is magnetic susceptibility. Electric motors with high-performance magnets, hard disk drives, and MRI machines are applications that rely on this property. Neodymium is particularly noted for its strong magnetic property.
2. Catalysis: The electron configuration within the atomic structure of REEs make them especially useful as powerful chemical catalysts to enhance chemical reactions. They are vital in petroleum refining, environmental cleanup, and other industrial processes such as hydrogenation, dehydrogenation, and automotive catalytic converters.
3. Strong co-ordination complex formation: This characteristic refers to the tendency of the REE to form a stable compound structure (co-ordination complexes) that remain thermodynamically stable and retain their structural integrity under typical operating conditions. This stability enhances the effectiveness of the REE compound in catalytic and material applications.
4. Unique optical properties: Some rare-earth metals – including europium (Eu) and terbium (Tb) – exhibit fluorescence and phosphorescence. These properties lend themselves to applications such as energy-efficient lighting, display technologies, and medical imaging.
5. High melting points: Rare earth metals possess high melting points, which make them particularly useful for high-temperature applications in aerospace and metallurgy industries. While this property ensures that materials are heat-resistant, stable, and durable under extreme conditions, it also means their production is very energy-intensive.

Global REE resources and who controls them

According to the UK Geological Society, the main REE reserves are found in China (including Bayan Obo mining district in Mongolia); former Soviet republics Russia, Kyrgyzstan, and Kazakhstan; the U.S. (including Mountain Pass REE deposit) and Australia (including the Mount Weld deposit). There are also resources in India, Vietnam, Malaysia, Thailand, Indonesia, South Africa, Namibia, Mauritania, Burundi, Malawi, Greenland, Canada, and Brazil.

Data from the United States Geological Survey (USGC) indicates that China leads with rare earth oxides (REO) reserves estimated at 44 million tonnes, followed by Brazil at 21 million tonnes, and India at 6.9 million tonnes. In production terms, China also led global production at 270,000 tonnes in 2024 and accounted for 68% of global production. Second to China was the United States at 45,000 tonnes, then Myanmar (Burma) at 31,000 tonnes. This distribution of reserves and mine sites globally is shown in Figure 2.

Figure 2 – Global distribution of REE occurrence by country.  (Source:  The Geopolitics of Rare Earth Elements)

Combining the reserves and production reveals that China has enough reserves to last 163 years at its current production level, while the United States’ reserves of 1.9 million tonnes can last 42 years at current production levels. This detail is shown in Table 2.

Table 2 – World rare earth metals mine production and reserves.

Although Brazil holds 23% of global REO reserves, it accounts for less than 0.005% of global production. This implies Brazil has an astronomical reserves/production ratio exceeding 1 million years. India, with 7.5% of global reserves, accounts for only 0.75% of global production and has a reserves/production ratio of 2,379 years. Then there is Russia, which holds 3.8 million tonnes of reserves (4.2% of global reserves) but only produces 2,500 tonnes (0.63% of global production) and has enough reserves to last 1,500+ years at its current production rate.

In terms of production growth, Thailand and Nigeria exhibited significant production increase from 2023 to 2024. Thailand’s REO production increased by 261% while Nigeria’s went up by 81% from 7,200 tonnes in 2023 to 13,000 tonnes in 2024. China and U.S. production increased by 6% and 8%, respectively, from 2023 to 2024. Even though production fell significantly in Australia (-19%), Brazil (-86%), Malaysia (-58%), and the rest of the world (-24%).

Overall, global production increased by 5%. The production increase to ~394,000 tonnes of REO equivalent in 2024 was largely driven by increased activity in China, Nigeria, and Thailand.

Drawing on data from the USGC and Benchmark Intelligence, Visual Capitalist produced the graphic in Figure 3 showing that over the long term, REO production increased from 64,500 tonnes in 1994 to its current value (approximated as 400,000 tonnes in the graphic).

Figure 3 – Thirty years of rare earth production shows China’s leading position. (Source: VisualCapitalist.com)

REO output from China increased from around 31,000 metric tons in 1994 to 270,000 metric tons in 2024 – an average growth rate of 7.5% per annum. China’s production accounts for 68% of current global production, up from 48% in 1994, and is six times US production, which is the second-largest producer of REE.

REE production experienced a tremendous surge in the last decade, during which it grew at a rate of 12% per annum, dwarfing the 2% annual growth rate from 2004-2014.

Why rare earths are classified as critical minerals

Demand for REE has grown significantly since 2010, driven by its application in “energy transition” technologies such as wind turbines, solar panels, electric vehicles, and some battery types. REEs also find applications in consumer electronics, with an estimated 15 grams of REE found in a smart phone. Defence applications such as jet fighters, guided missiles, surveillance technology, and tactical drones also rely on REE.

As of 2023, the largest share of REE demand is attributed to magnets (45.7%), followed by catalysts (16.4%), polishing powders (10.9%), metallurgical uses (6.6%), glass (6.2%), ceramics (3.1%), batteries (2.0%), phosphors (0.5%), and pigments (0.3%). Other uses accounted for the remaining 8.4%.

In terms of specific REEs, neodymium had the highest demand (33%), followed by cerium (32%), lanthanum (20%), praseodymium (7%), yttrium (3%), with the remaining REEs making up 5%.

REEs are a subset of minerals that has been classified as critical. The classification of a mineral as critical is based on the economic impact that would arise from the disruption in the minerals’ supply, national security concerns, and other strategic factors.

Specifically, the United States Energy Act of 2020 defines a “critical mineral” as:

“Any mineral, element, substance, or material designated as critical by the Secretary of the Interior, acting through the director of the U.S. Geological Survey.”

The act further empowers the USGC to develop the methodology by which minerals are designated as “critical” with a mandate to update the “List of Critical Minerals” no less than every three years. The List of Critical Minerals meets the following criteria:

“…

1. are essential to the economic or national security of the United States;
2. the supply chain of which is vulnerable to disruption (including restrictions associated with foreign political risk, abrupt demand growth, military conflict, violent unrest, anti-competitive or protectionist behaviors, and other risks throughout the supply chain); and

• serve an essential function in the manufacturing of a product (including energy technology-, defense-, currency-, agriculture-, consumer electronics-, and health care-related applications), the absence of which would have significant consequences for the economic or national security of the United States.”

This is according to Sec. 7002 (c) of the Energy Act of 2020.

Figure 4 shows a criticality matrix and where different minerals are classified. This matrix is developed with an eye to the importance of the minerals to energy, hence a subset of the REEs is captured in the “critical” quadrant.

Figure 4 – Medium-term criticality matrix showing where the REEs are classified. (Source: US Department of Energy, National Energy Technology Labs)

Rare earths such as dysprosium, neodymium, and praseodymium are classified as critical for their importance to energy applications in the medium term (2025-2035).

As of 2025, the USGC classified 60 minerals as critical – 50 of these were carried over from the 2022 list of critical minerals, and 10 are new: boron, copper, lead, metallurgical coal, phosphate, potash, rhenium, silicon, silver, and uranium. There are 15 rare earth elements included on the list as shown in Figure 5.

Figure 5 – USGC list of 60 critical minerals (2025) includes 15 rare earth elements.

The European Union, meanwhile, passed the Critical Raw Materials Act (CRMA), which entered into force in May 2024. The CRMA is focused on the expansion of the EU’s domestic capacities to extract, process, and recycle raw materials. Since 2011, the EU’s list of critical materials has grown from 20 in 2011 to 34 in 2023.

According to the CRMA, a raw material is considered critical “…due to their high economic importance and their exposure to high supply risk, often caused by a high concentration of supply from a few third countries.”

Criticality of raw material for the EU, therefore, is based on two parameters: economic importance (EI) and supply risk (SR). The recent list of 34 critical materials was determined after screening 70 candidate raw materials. Like the U.S. Energy Act 2020, the EU’s CRMA requires that the list of critical raw materials be updated at least every three years with provisions of the methodology for ascertaining materials’ criticality.

Figure 6 shows the EU’s latest list of critical raw materials, including light and heavy REE.

Figure 6 – EU list of critical raw materials.

While the U.S. and EU definition of criticality includes vulnerability of supply into their economies, other countries including Canada, Australia, and China adopt a different lens. For these countries, minerals are considered critical when the country has a strategic interest in leveraging its abundant mineral reserves to gain competitive advantage in the global supply chain. Australia, for example, has a list of 31 critical minerals as of February 2024. This list was developed by assessing the global technology needs of Australia’s partner countries and its own geological endowment. Australia has a high geological potential on 16 of the 31 minerals, with the rest having moderate potential.

From the foregoing, REEs are a subset of “critical minerals” or “critical materials” as defined by both the United States and the European Union. A key aspect of defining “criticality” is the susceptibility to supply chain disruption, which is assessed through import dependence or net import reliance. The U.S. net import reliance for REE is 80% – supplied from China, Malaysia, Japan, and Estonia. As for the EU, it is 99% net import reliant on China for its REE.

(Kaase Gbakon, BIG Media Ltd., 2025)