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Recently, a top US official returned from South Carolina holding up a small piece of metal, proclaiming it was the initial rare-earth magnet manufactured in the US in decades.

He remarked that this was proof the US is overcoming “China's dominance on our industrial pipeline.” Due to a recently opened rare-earth mineral refining facility in South Carolina, the official continued, “The nation is regaining its autonomy.”

Challenging Beijing's Control in Critical Materials

Reducing Beijing's refining and production supremacy in these minerals, which are crucial for advanced electronics, batteries, and military equipment, is a top priority for the American leadership. Via tariffs and other strategies, the US is relying on returning the industry home to domestic facilities.

These measures led China to restrict rare-earth shipments to the US and motivated the administration to sign deals with an ally, Malaysia, Cambodia, and a key Asian economy.

While the US and China have now brokered a temporary agreement on rare earths, China—with around the majority of worldwide extraction and over 90% of global processing capacity—has a head start that may prove challenging to overcome.

“Rare earths are essential for electric motors but also in defense technology that have clear uses for the defense department,” says a market analyst. “Anything that has a decent magnet in it requires rare earths.”

No Easy Fix for American Self-Sufficiency

There’s no easy fix for the US to reset its dependence on Chinese production of minerals essential to national security, semiconductor production, and the shift from traditional energy to wind and solar. Data from federal reports, the US brought in 80% of the rare earths it used in 2024.

For some rare-earth minerals such as dysprosium, used in semiconductors, and another mineral, critical for defense systems, Chinese refinement dominance reaches almost total. These elements are used in magnets crucial to EV motors and power systems in renewable energy, along with applications for mobile devices, advanced lighting, and nuclear reactors.

Long-Term Efforts and Global Deposits

Efforts to reduce the US’s dependence on China's output of rare-earth minerals may require a long time. Experts note that “Rare earths” is somewhat of a misnomer because they’re relatively abundant in the planet's surface, but many deposits, including those in Eastern Europe, where a deal was made earlier this year, are only in the early stages of mining.

“The issue isn't scarcity per se, it’s that Beijing can limit how much is exported,” a specialist explained, noting that obtaining export licenses from China can be a complex and time-consuming endeavor.

Greenland, a key area of American interest, and South America, are additional nations with substantial rare-earth deposits. In the continental US, there are deposits in the West, the Midwest, and the central US, with the largest operational mine located at Mountain Pass, the state, about 60 miles from Las Vegas.

Government Initiatives and Funding

In July, the US Department of Defense took on the role of the largest shareholder in a mining company, with plans to open a new “mine-to-magnet” plant, named 10X, to produce magnets essential for F-35 fighter jets, unmanned systems, and submarines.

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

Following government funding in other sectors and US chipmakers, the interior department announced it was ready to make direct investments in critical mineral companies.

“The US is up against state capital because Beijing is picking these as priority areas that they want to invest in,” a cabinet member stated during a address this spring.

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

Past Challenges and Prospects

US efforts to promote domestic production have floundered in the past when Chinese producers lowered prices, rendering unsupported rare-earth development uneconomic against Asia's competitive pricing and long-term strategic outlook.

Five years ago, a market expert testified before a congressional panel that “those who invest in battery capacity and supply chains today are poised to lead this sector for the foreseeable future. It is not too late for the US but action is needed now.”

Five years on, a scramble to build trading alliances around rare earths is speeding up.

“Soon, we’ll have so much critical mineral and rare earths that you won’t know what to do with them,” a top leader told the media. That came in the wake of a request for payment in the form of natural resources from Ukraine. In September, the government of Pakistan agreed to a deal with an US firm, giving it access to minerals such as key metals.

Can the US Succeed?

But, can the US make up its gap and loosen China’s hold on rare-earth supply chains? “America has implemented really significant steps already,” an analyst says. The US, he adds, is unlikely to become “self-reliant in the short term because it requires years to start operations and build refining capacity.”