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MEDIUM RARE: HOW TO BREAK THE RARE EARTH ELEMENT CHOKEHOLD By Evan Anderson
Why Read: Recent US/China negotiations have highlighted our severe reliance on Chinese supply chains for rare earth elements. This week, we delve into what that means for US and allied foreign policy, what can be done about it, and why solving for REEs is one of the best business opportunities today. ______ The rare earth elements perplex us in our researches, baffle us in our speculations, and haunt us in our very dreams. They stretch like an unknown sea before us, mocking, mystifying and murmuring strange revelations and possibilities. - Sir William Crookes, 1887 Over the past several decades, China has emerged as the world's dominant force in the rare earth sector. Through sustained investment across the entire value chain - from mining and refining to downstream manufacturing - China has built a comprehensive and highly integrated REE industry. Today, it accounts for the majority of global REE production and processing, and is the leading exporter of critical REE-based products such as permanent magnets. - China Briefing, August 29, 2025
Among other lessons, the last few years of "pandemic era" economics have shown the cracks in the global supply chain for goods. This is doubly so with highly specialized inputs to production that come from a single, or from limited, sources. With trade wars and tariffs the name of the game in global commerce today, these cracks are yawning wider, and the consequences are dire. In his book Chokepoints: American Power in the Age of Economic Warfare, Edward Fishman points out that we live in an era in which sanctions and tariffs have been comprehensively added to the list of ways that nations wage war. Throughout the daily interactions between CRINK and the West, economic tools are now employed regularly to create kinetic realities. As Fishman points out: Great powers once rose and survived by controlling geographic chokepoints like the Bosphorus. American power in the globalized economy relies on chokepoints of a different kind. Among them is the US dollar, the default currency for international trade and finance. Other chokepoints include the main banks and networks that move money around the world and the intellectual property and technical know-how that underpin a vast array of essential technologies, notably the advanced computer chips at the core of the digital economy. Of the inputs to production that shape our modern economy, few stand out as much as rare earth elements. These metals allow for the creation of materials that enable technologies that discern a high-tech nation from a low-tech one. Critically, they also now represent one of the world's greatest chokepoints. In this case, it is China that controls the proverbial Bosphorus. |
