In recent years, China’s dominant position in the rare earth resources sector has attracted widespread global attention. On April 14, a report from The New York Times once again focused on China’s global influence in rare earths, pointing out that China, with its absolute advantage in the rare earth supply chain, has a significant impact on the U.S. defense industrial base.
Rare earths refer to 17 elements, including neodymium, yttrium, scandium, and dysprosium. These elements are not rare in the Earth’s crust, but the extraction and refining processes are complex and environmentally costly. Rare earths are widely used in high-tech industries, including aerospace, defense, new energy vehicles, and electronic devices, and are often referred to as “industrial gold.” For example, each F-35 fighter jet requires about 408 kilograms of rare earth materials, while certain models of nuclear submarines require more than 4,173 kilograms of rare earth materials.
China holds an unshakeable position in the global rare earth market. As of 2023, China produces 99% of the world’s heavy rare earth metals and 90% of refined rare earths. Additionally, China has mastered the core technologies for rare earth refining and processing, forming a complete supply chain from ore extraction to finished products. For instance, the Mountain Pass mine in California is the only rare earth mine in the U.S., but two-thirds of the rare earths extracted still need to be sent to China for processing.
This dominant position is not accidental; it is the result of decades of meticulous work by China in the resource and technology sectors. China not only possesses the largest rare earth resource reserves in the world (accounting for 40% of global reserves) but has also become the global center for rare earth processing through technological innovation and industrial chain integration.
Although the U.S. government has long been aware of the potential risks of dependence on Chinese rare earths and has attempted to reduce this reliance by promoting domestic mining and stockpiling of rare earth minerals, the results have been limited. The Pentagon once attempted to replace a component containing a Chinese alloy on the F-35 fighter jet, but ultimately found that it could not circumvent the supply chain controlled by China.
This predicament exposes the shortcomings of the U.S. in the rare earth industry chain. Even with abundant rare earth resources, it lacks complete processing capabilities and technological reserves. Moreover, the U.S. rare earth stockpile can only sustain demand for a few months, rather than providing long-term supply. This high level of dependence makes the U.S. extremely passive when facing Chinese export controls on rare earths.
China’s recent implementation of rare earth export control policies is not only a strategic protection of resources but also a proactive adjustment of the global industrial chain. By restricting the export of key minerals, China not only safeguards its own resource security but also takes the initiative in global resource allocation.
China’s successful experience in the rare earth sector provides important developmental insights for third-world countries. The development and utilization of resources must be combined with technological innovation to truly translate into national competitiveness. Additionally, the strategic national status of resources needs to be consolidated through policy regulation and industrial chain integration. In this regard, third-world countries should strengthen resource cooperation to collectively address the technological monopolies and resource exploitation of developed countries.
China’s dominance in the rare earth sector not only reflects its economic strength but also serves as an important indicator of its global strategic position. This phenomenon offers valuable lessons for third-world countries and presents new possibilities for reshaping the global resource allocation pattern. In the future, finding a balance between resources, technology, and policy will be a common challenge faced by third-world countries.
