The Silent Circuitry of Modern Industry is Under Pressure

Imagine a state-of-the-art assembly line for a next-generation electric vehicle motor, a marvel of efficiency and precision, suddenly grinding to a halt. The cause is not a familiar logistics snag or a quality control issue with a Tier 1 supplier. Instead, the disruption originates thousands of miles away, not from a factory floor, but from a policy announcement in Beijing. This scenario is no longer a hypothetical exercise for risk managers; it is the new operational reality for manufacturers of the world's most advanced products. The recent shutdown of a Ford EV component plant, stalled by a shortage of rare-earth magnets amid tightening Chinese export controls, serves as a stark illustration of this vulnerability.

The era of treating rare earth elements (REEs) as simple commodities, procured on the basis of price and availability, is definitively over. Geopolitical strategy has become a direct and critical input into the bill of materials for electric vehicles, fighter jets, MRI machines, and the semiconductors that power our digital world. China’s implementation of sweeping export controls, targeting not just the 17 critical elements themselves but also the technology required to process them and manufacture high-performance magnets, represents a structural realignment of global supply chains. These actions, framed as necessary to protect national security, effectively weaponize a decades-long dominance over the materials that form the silent circuitry of modern industry.

For supply chain and manufacturing leaders, navigating this new landscape requires a fundamental shift in perspective. It demands a granular understanding of how a restriction on an obscure element like dysprosium can threaten a flagship product line, and how a policy decision can have a more profound impact than a port closure. This report serves as an essential strategic briefing, deconstructing the complex interplay between materials, manufacturing, and geopolitics. It provides a detailed, technically accurate breakdown of the real-world impact of rare earth controls, moving beyond headlines to deliver sector-specific vulnerability assessments and tailored mitigation strategies for the leaders tasked with building the future.

The Periodic Tables Strategic Assets: Mapping Rare Earths to Your Bill of Materials

To comprehend the current supply chain crisis, it is essential to first understand why these 17 metallic elements are indispensable. Their strategic value does not stem from their geological rarity—many are more abundant in the Earth's crust than copper or lead—but from their unique magnetic, luminescent, and catalytic properties that are difficult, if not impossible, to replicate. These properties enable the miniaturization, efficiency, and high performance that define modern technology.

Crucially, manufacturers of complex systems do not procure raw rare earth ore. Instead, they rely on a multi-stage value chain that transforms these elements into intermediate components. The most significant of these are high-performance permanent magnets, which alone accounted for over 45% of global REE demand in 2023. These magnets, primarily Neodymium-Iron-Boron (NdFeB) and Samarium-Cobalt (SmCo) types, are the workhorses that translate electrical energy into motion in EV motors, guide missiles with precision, and generate images in medical scanners. The following matrix provides a clear, scannable guide that maps specific REEs to the components and final products most relevant to advanced manufacturing.

The Global Chokepoint

While the table above illustrates the why of REE dependence, the strategic risk is rooted in the where. The global supply chain for rare earths is characterized by a critical chokepoint. Although China accounts for approximately 60-70% of global rare earth mining, its dominance intensifies dramatically in the subsequent, more technologically complex stages. The country controls nearly 90% of the world's REE separation and refining—the process of turning mixed ores into high-purity oxides—and manufactures over 90% of the high-performance permanent magnets that are the final input for many industries.

Key Takeaways:

• The data clearly shows that the most significant supply chain risk is not in raw material extraction but in the midstream (refining) and downstream (magnet manufacturing) stages.
• China's near-total control over processing and magnet production gives it immense geopolitical leverage, as it can influence the supply of finished components essential for Western industries.
• Any effective diversification strategy must focus on building capacity in these value-added stages, not just opening new mines.

This creates a boomerang dependency for countries like the United States, which, despite having domestic mining operations, exports over 95% of its raw rare earth concentrate to be processed, refined, and manufactured into essential components, often in China, before being re-imported. This structure means that even with a secure domestic source of raw materials, the industrial base remains critically vulnerable to disruptions in the midstream and downstream segments of the supply chain.

Key Takeaways:

• While China is the largest miner of rare earths, its share of mining (~69% in 2024) is significantly lower than its share of processing and magnet manufacturing.
• The United States is the second-largest producer of raw rare earth ore, highlighting that the primary vulnerability is a lack of domestic processing capacity, not a lack of domestic resources.
• The rise of production in countries like Burma, Nigeria, and Thailand indicates a global effort to diversify raw material sources, but this does not address the processing bottleneck.

The nature of this dominance reveals a crucial reality: the primary strategic bottleneck is not geology, but rather manufacturing know-how. An analysis of China's recent export controls shows a deliberate focus that extends beyond the raw materials themselves. The restrictions explicitly target the technology, intellectual property, and equipment related to rare earth processing, separation, and magnet manufacturing. This strategic calculus demonstrates an understanding that the most significant and difficult-to-replicate advantage lies in the decades of accumulated expertise in the complex metallurgy and chemistry required to transform raw oxides into high-performance alloys and magnets. Simply opening a new mine in North America or Australia, while a necessary first step, is an insufficient response. Without a parallel, and far more challenging, initiative to rebuild this lost midstream and downstream industrial capability, the fundamental dependency remains unresolved. The true strategic moat is industrial and intellectual, not geological.

Sector Vulnerability Index: A Four-Front Analysis of Supply Chain Risk

The strategic risk posed by rare earth supply chain concentration is not monolithic. It manifests differently across various manufacturing sectors, with unique dependencies, impact profiles, and vulnerabilities. A nuanced understanding of these differences is the first step toward developing effective, tailored mitigation strategies.

Automotive: The EV Revolution Hits a Geopolitical Red Light

The global transition to electric vehicles (EVs) is inextricably linked to the availability of rare earth elements. The dominant motor technology, the Permanent Magnet Synchronous Motor (PMSM), is used in over 86% of EVs due to its superior efficiency, high torque output, and compact design. These motors are critically dependent on high-strength NdFeB permanent magnets. To withstand the high operating temperatures of powerful EV drivetrains, these magnets are frequently alloyed with the heavy rare earths dysprosium and terbium to enhance their thermal stability.

The sheer scale of the automotive industry's electrification goals creates a massive and rapidly growing demand profile. Global REE demand from EV motors alone reached 37,000 metric tons in 2024, a 32% year-over-year increase, and is projected to climb to 43,000 metric tons in 2025.

Key Takeaways:

• Demand for rare earths from the EV sector is growing exponentially, more than doubling in just three years.
• This rapid growth makes the automotive industry a major driver of overall REE demand and highly exposed to supply disruptions.
• The forecast for 2025 indicates that this intense demand growth is expected to continue, putting further pressure on an already constrained supply chain.

This high-volume dependency makes the automotive sector acutely sensitive to both supply shortages and price volatility. The price of neodymium oxide, a key magnet precursor, has demonstrated extreme fluctuation, swinging between $39.50 per kilogram and $193.75 per kilogram since the beginning of 2020.

Key Takeaways:

• The price of neodymium oxide, a critical input for EV motor magnets, is extremely volatile, more than doubling from 2020 to 2022 before falling again.
• This volatility makes long-term cost planning and maintaining stable profit margins exceptionally difficult for high-volume automakers.
• Such price swings are driven by a combination of demand surges, supply constraints, and geopolitical actions, making the market difficult to predict.

Such volatility can wreak havoc on cost modeling and profitability for a high-volume, margin-sensitive industry. The real-world consequences of this vulnerability are no longer theoretical. In May 2025, Ford Motor Company confirmed the temporary shutdown of a plant producing EV components, citing a shortage of rare-earth magnets stemming from China's tightening export controls. This incident provided a stark case study of how a single, geopolitically driven supply chain bottleneck can halt a multi-billion-dollar manufacturing operation, sending ripple effects through the entire automotive sector.

Key Takeaways:

• Permanent Magnet Synchronous Motors (PMSMs), which depend on rare earth magnets, are the dominant technology, accounting for over 86% of the market in 2024.
• While REE-free technologies like EESM are growing, their market share remains small, meaning the industry's dependence on rare earths will persist for the foreseeable future.
• The continued dominance of PMSMs underscores the urgency of securing REE magnet supply chains or accelerating the adoption of alternative motor designs.

Aerospace & Defense (A&D): When National Security Depends on a Global Supply Chain

The aerospace and defense sector's relationship with rare earths is defined by low-volume, high-specification requirements. While the total tonnage consumed is less than in the automotive industry, the performance of mission-critical systems is absolutely dependent on these materials. Key applications include Samarium-Cobalt (SmCo) magnets, prized for their exceptional high-temperature performance and corrosion resistance, which are essential in jet engines, missile guidance systems, and advanced radar. NdFeB magnets are also used extensively in electric actuators for flight control surfaces, power generation systems, and drone motors.

The quantity of REEs required on a per-unit basis for major defense platforms is staggering. A single F-35 Lightning II fighter jet contains approximately 418 kilograms (over 900 pounds) of rare earth materials, embedded in its targeting systems, lasers, and electric motors. Naval platforms are even more demanding: an Arleigh Burke-class destroyer requires 2,600 kilograms, and a Virginia-class nuclear submarine needs a massive 4,600 kilograms to power its sonar, radar, missile guidance, and propulsion systems.

Key Takeaways:

• The sheer volume of rare earths in a single defense platform makes the A&D sector highly vulnerable to supply disruptions, even if its total consumption is lower than the automotive industry.
• These materials are not interchangeable commodities; they are integral to the performance of the most advanced military systems, from stealth capabilities to precision targeting.
• A supply disruption of key REEs like samarium or neodymium could directly impact the production of critical national security assets.

The unique and crippling vulnerability of the A&D industry is its extraordinarily long material qualification timeline. Due to the extreme performance and reliability requirements of defense applications, it can take anywhere from 5 to 15 years and cost millions of dollars to test, certify, and qualify a new material or a new supplier for a critical component. This reality makes the concepts of rapid substitution or agile supplier diversification nearly impossible in a crisis. An export ban on a specific grade of SmCo alloy could, in effect, halt production of a critical defense system for a decade, posing a direct threat to national security.

Medical Technology: A Hidden Crisis in Healthcare Innovation

The medical technology sector's reliance on rare earths is broad, deep, and largely invisible to the public. These elements are the foundation for many of modern medicine's most powerful diagnostic and therapeutic tools. Gadolinium is the essential component in contrast agents used in approximately one-third of all Magnetic Resonance Imaging (MRI) scans, enhancing image clarity to detect tumors and other abnormalities. The powerful magnets at the heart of the MRI machines themselves depend on neodymium, praseodymium, dysprosium, and terbium. Other critical applications include lutetium in Positron Emission Tomography (PET) scanners, and erbium, holmium, and yttrium in high-precision surgical lasers.

A disruption in the supply of these elements would not just be an industrial problem; it would be a public health crisis, directly impacting the ability to diagnose and treat disease for millions of patients. The unique vulnerability for the medical sector lies in a hidden bottleneck: extreme purity requirements. To be used in medical devices and pharmaceutical applications, REEs must often exceed 99.99% purity, a standard far more stringent than that for most consumer electronics or even many military uses. This highly specialized, pharmaceutical-grade processing is performed in fewer than a dozen facilities worldwide, creating an exceptionally concentrated and fragile chokepoint within the broader REE supply chain. Industry analysis suggests that a sustained disruption could delay the launch of new, innovative medical devices by 12 to 24 months and increase the production cost of critical imaging equipment by 15% to 30%, costs that would inevitably be passed on to already strained healthcare systems.

Consumer Electronics & Semiconductors: High Volume, High Stakes

The consumer electronics and semiconductor industries consume rare earths in countless applications, often in minute quantities per device but on a massive scale globally. NdFeB magnets power the tiny vibration motors and high-fidelity speakers in smartphones. Yttrium, europium, and terbium are used as phosphors to create the vibrant colors in LED and LCD screens. In the foundational process of semiconductor manufacturing, cerium and lanthanum oxides are the preferred materials for the chemical-mechanical planarization (CMP) slurries used to polish silicon wafers to achieve atomic-level smoothness.

While the REE cost per unit is often small, the sheer volume of production and the industry's reliance on just-in-time manufacturing models make it highly exposed to price shocks and component shortages. An unexpected shortage of a specific magnet or polishing compound can disrupt production lines for millions of devices, leading to significant revenue loss. The sector's most acute vulnerability, however, has been explicitly targeted by recent policy. China's export controls now subject license applications for rare earth materials used in the production of advanced semiconductors (specifically, sub-14-nanometer nodes) to a case-by-case review by government authorities. This measure gives Beijing direct strategic control over a critical input for the global high-end technology supply chain, posing a direct threat to the future of advanced computing.

A critical distinction emerges when analyzing these sectors: vulnerability is not a monolithic concept. For the automotive and electronics industries, the primary risk is one of volume and velocity. Their high-throughput, just-in-time production models make them acutely sensitive to price volatility and short-term component shortages that can idle massive assembly lines, as seen with Ford. Their vulnerability is measured in days or weeks of production lost. In contrast, the aerospace & defense and medical technology sectors face a risk defined by time and qualification. Their primary vulnerability is not an immediate price spike but the catastrophic, long-term inability to produce mission-critical or life-saving equipment due to the near-impossibility of rapidly qualifying new materials or suppliers, a process that can take up to 15 years. This fundamental difference between "volume-risk" and "time-risk" dictates that a one-size-fits-all mitigation strategy is not just suboptimal, but dangerously simplistic.

From Reactive to Resilient: Tailored Mitigation and Sourcing Strategies

Analyzing vulnerabilities is a necessary diagnostic step, but building resilience requires a transition to actionable, forward-looking strategies. Given the distinct risk profiles across different manufacturing sectors, these strategies must be tailored, moving beyond generic advice to address specific operational realities.

Strategic Sourcing in a Geopolitical World

The approach to sourcing critical materials must evolve to reflect the new geopolitical landscape. The optimal strategy differs significantly based on the nature of the end product and its market.

• For High-Volume/Low-Margin Sectors (Electronics, Automotive): The focus should be on building operational agility and buffering against short-term disruptions. Key tactics include aggressive dual-sourcing for critical components where feasible, building strategic inventory buffers of key materials or sub-assemblies to weather price shocks and short-term shortages, and fostering deep collaboration with suppliers to gain multi-tier visibility into the supply chain. Design teams should be incentivized to explore architectures that reduce or eliminate dependency on the most at-risk REEs.
• For Low-Volume/High-Specification Sectors (A&D, Medical): The primary goal is not cost optimization but supply chain security and long-term resilience. Sourcing strategies should prioritize the establishment of long-term partnerships with trusted domestic or allied suppliers, even at a cost premium. This can involve co-investment in developing new production capabilities and securing multi-year offtake agreements that guarantee supply. The calculus shifts from minimizing unit cost to minimizing the catastrophic cost of a production line stoppage for a system that has a multi-decade service life.

Engineering a Way Out: Substitution and Innovation

The most durable solution to material dependency is to engineer around it. Significant progress is being made in developing viable alternatives to REE-dependent technologies, particularly in the critical area of permanent magnets.

• REE-Free Motors: A promising development for the automotive sector is the commercialization of motor designs that eliminate permanent magnets entirely. The Electrically Excited Synchronous Motor (EESM), for example, uses an electromagnetic field generated by passing current through copper windings in the rotor, thus removing the need for neodymium or dysprosium. Automaker suppliers like Valeo have developed advanced EESM technology with improved power density and efficiency, and are targeting a start of production (SOP) in 2027, offering a concrete path to de-risk the EV supply chain.
• Alternative Magnet Technologies: For applications where permanent magnets remain essential, a new generation of REE-free materials is emerging from research labs and entering the pre-commercial phase. These alternatives offer different trade-offs in terms of performance, cost, and manufacturing readiness.

Key Takeaways:

• Incumbent REE magnets (NdFeB, SmCo) offer a proven balance of high performance and commercial readiness, but carry significant supply chain risk.
• Emerging technologies like Iron Nitride show immense theoretical potential, offering performance that could exceed current standards while using abundant, low-cost materials.
• While not yet fully commercial, these alternatives represent a critical area for R&D investment and strategic partnerships to design out long-term dependency on rare earths.

Iron Nitride, in particular, shows significant promise. Composed of abundant and inexpensive iron and nitrogen, it has the theoretical potential to be more than twice as powerful as NdFeB magnets. Companies like Niron Magnetics are actively working to commercialize this technology, forming partnerships to scale production for applications in EVs and power generation. While challenges in manufacturing at scale remain, these materials represent a critical area for R&D investment for any company seeking to future-proof its products.

The Urban Mine: Scaling Magnet Recycling

An immense and largely untapped resource for rare earths exists not in the ground, but in the accumulated stock of end-of-life products. Currently, less than 1% of rare earth magnets are recycled, representing a massive loss of valuable materials and a significant opportunity. A new wave of innovative companies is developing advanced processes to create a circular supply chain.

Companies like Redwood Materials, founded by a former Tesla executive, and Cyclic Materials are pioneering hydrometallurgical processes that can efficiently extract and separate high-value rare earths like neodymium and praseodymium from shredded e-waste and discarded EV motors. These "urban mining" operations offer a powerful way to build a resilient domestic supply chain that bypasses both the geopolitical risks of international mining and the significant environmental challenges associated with new extraction. Scaling these technologies is a critical component of a comprehensive national and corporate resilience strategy.

Strategic Stockpiling: A National and Corporate Imperative

In the face of potential supply disruptions that could last months or even years, stockpiling becomes an essential tool for both governments and corporations. At the national level, the U.S. Department of Defense, through its Defense Logistics Agency, is taking action. Recent plans call for the purchase of up to $1 billion in critical minerals for the National Defense Stockpile, including materials often found with REEs like cobalt ($500 million), as well as antimony ($245 million) and tantalum ($100 million).

For corporations, a stockpiling strategy must be more nuanced than simply hoarding raw ore. Given that the most significant bottleneck is in midstream processing, a more effective approach is to secure inventory of processed materials, such as high-purity oxides, refined metal alloys, or even finished magnets. This provides a buffer against the more likely scenario of a disruption in refining or manufacturing capacity, rather than a halt in mining. While capital-intensive, a well-designed corporate stockpile can provide the crucial runway needed to activate alternative suppliers or re-engineer products during a prolonged crisis.

The American REE Renaissance: Rebuilding a Domestic Supply Chain

For decades, the United States ceded its leadership in the rare earths industry. Today, a combination of geopolitical necessity and government support is catalyzing a nascent effort to rebuild a complete, domestic supply chain. This endeavor is fraught with challenges but also presents a significant opportunity for innovation and long-term industrial resilience.

Mapping the Nascent US Ecosystem

A domestic REE ecosystem is beginning to take shape, with companies emerging at various stages of the value chain.

• Upstream (Mining): The cornerstone of U.S. extraction is MP Materials (NYSE: MP), which operates the Mountain Pass mine in California. As the only active rare earth mine in the nation, it supplied approximately 15.8% of the world's raw REE production in 2020. Other companies like American Rare Earths and NioCorp Developments are advancing significant exploration and development projects in Wyoming, Arizona, and Nebraska.
• Midstream (Processing & Separation): This remains the most critical gap in the U.S. supply chain. However, pioneers are making headway. ReElement Technologies, a subsidiary of American Resources Corp., operates a facility capable of separating both light and heavy rare earths at scale using chromatography, a less chemically intensive process. Energy Fuels is leveraging its existing infrastructure at its White Mesa Mill in Utah to process monazite sands (a source of REEs) into a usable carbonate.
• Downstream (Magnet Manufacturing): The final, crucial link is the ability to turn refined metals into high-performance magnets. MP Materials is at the forefront of this effort, constructing a magnet manufacturing facility in Fort Worth, Texas. This project, supported by the Department of Defense, aims to create the first fully integrated, "mine-to-magnet" supply chain in the United States.

Government as a Catalyst: Policy and Funding

Recognizing the national security implications of REE dependency, the U.S. government has launched several initiatives to de-risk private investment and accelerate the onshoring of this critical industry.

• Department of Energy (DOE) Funding: The DOE has earmarked significant funding to support technological development and commercialization. Key programs include up to $135 million for a Rare Earth Elements Demonstration Facility to prove the viability of domestic refining and recovery methods, and a $50 million Critical Minerals and Materials Accelerator program that specifically targets improvements in the rare-earth magnet supply chain.
• Department of War (DoW) Investment and Offtake: The DoW is acting as a strategic partner and anchor customer for the emerging domestic industry. Through direct investments and offtake agreements, such as its multi-billion-dollar deal with MP Materials, the DoW is guaranteeing a minimum price floor for key materials like neodymium-praseodymium (NdPr) oxide. This price support is crucial, as it creates a stable, predictable market that can attract the long-term private capital needed to build out expensive processing facilities.

Key Takeaways:

• The U.S. government is making substantial financial commitments to rebuild the domestic REE supply chain, focusing on the critical midstream processing and downstream manufacturing gaps.
• The funding targets both traditional and innovative approaches, such as recovering REEs from waste streams, which can reduce environmental impact and create new resource pathways.
• These initiatives aim to de-risk private investment by providing foundational funding for demonstration facilities and technology accelerators, signaling a long-term strategic commitment.

The Hurdles to Exponential Production: A Sober Assessment

Despite this momentum, the path to a fully scaled, competitive domestic REE industry is steep and laden with significant challenges.

• Environmental and Permitting: Rare earth processing is notoriously resource-intensive and polluting. Traditional solvent-extraction methods generate large volumes of waste containing strong acids and radioactive elements like thorium and uranium. Navigating the stringent U.S. environmental regulations and overcoming local community opposition can delay new mining and processing projects for a decade or more, a timeline that is misaligned with the urgency of the supply chain threat.
• Technological and Human Capital Gaps: The U.S. has lost decades of institutional knowledge and hands-on expertise in the complex metallurgy of REE separation and alloying. Rebuilding this specialized workforce and the underlying technological base is not a short-term project; it is a generational challenge that requires sustained investment in university programs, vocational training, and R&D.
• Economic Viability: Perhaps the greatest hurdle is economic. New U.S. projects, which require enormous upfront capital investment (often around $1 billion per project), must compete with an established, state-subsidized Chinese industry that can leverage its scale to control global prices. The chronic price volatility, heavily influenced by Chinese domestic policy, deters private investors who fear that China could deliberately flood the market and crash prices to render new Western projects unprofitable—a tactic that would stifle diversification efforts.

The confluence of these challenges suggests that a strategy based on simply replicating China's existing industrial model is unlikely to succeed. The United States cannot compete on lower labor costs, laxer environmental standards, or the scale of state-supported infrastructure. A head-to-head race on these terms is a losing proposition.

Instead, the most viable path forward for the U.S. is to leverage its primary competitive advantage: its unparalleled innovation ecosystem. The future of a resilient American REE industry lies not in imitation, but in pioneering and scaling a new generation of cleaner, more efficient, and more flexible technologies. Innovators like Phoenix Tailings, which is developing a molten-salt electrochemistry process to extract pure rare earth metals directly from mining waste and coal ash, offer a way to bypass multiple polluting and costly steps of the traditional value chain. Similarly, companies like REEGen are exploring bio-leaching, using engineered microbes to extract REEs with significantly lower energy and chemical inputs.

These breakthrough approaches can fundamentally alter the economics and environmental footprint of the industry. Technologies that are cleaner can accelerate the permitting process. Technologies that are more efficient can improve cost-competitiveness. And technologies capable of processing diverse feedstocks, including industrial waste and recycled materials, can reduce the reliance on new, disruptive mining operations. The most effective long-term strategy for both government and industry is to invest heavily in scaling these leapfrog technologies, turning a strategic industrial disadvantage into a durable competitive edge built on innovation.

Conclusion: Navigating the New Era of Geopolitical Supply Chains

The analysis presented makes one conclusion unequivocally clear: the risk to rare earth element supply chains is no longer a theoretical "black swan" event or a distant geopolitical headline. It is a clear, present, and recurring operational reality for the world's most critical manufacturing sectors. China's strategic use of export controls has fundamentally and permanently altered the risk calculus for any company whose products rely on high-performance magnets, advanced optics, or specialized catalysts. To treat this as a temporary trade spat is to misread a tectonic shift in the relationship between global commerce and national strategy.

For senior leaders in manufacturing and supply chain management, inaction is no longer a viable option. The new era of geopolitical supply chains demands a proactive, strategic, and sustained response. The path to resilience requires a multi-pronged approach grounded in the realities of this new landscape.

A new strategic imperative has emerged for industry leaders:

1. Audit Your True Vulnerability: The first step is to achieve radical transparency. This means moving beyond Tier 1 supplier declarations to map true REE dependencies deep within the multi-tier supply chain. It is essential to identify not just which components contain REEs, but which specific elements are used, where they are processed, and what alternatives exist.
2. Invest in Agility and Innovation: Resilience must be designed into the products of tomorrow. This requires allocating R&D funding to actively explore material substitution, design for recyclability, and validate alternative technologies like REE-free motors and next-generation magnets. Building this flexibility creates strategic options that will pay dividends for decades.
3. Forge Domestic and Allied Partnerships: No single company can solve this challenge alone. Building a secure supply chain requires active collaboration with the emerging domestic and allied REE ecosystem—from exploration firms and innovative processors to recyclers and magnet manufacturers. Long-term offtake agreements and co-investments are powerful tools to help scale this nascent industry.
4. Engage with and Shape Industrial Policy: The rebuilding of a domestic REE industry is a national imperative that requires a partnership between the public and private sectors. Industry leaders must actively engage with policymakers to ensure that government support—whether through funding, price supports, or streamlined permitting—is aligned with the real-world technical and economic challenges of scaling a competitive and sustainable supply chain.

The forces reshaping the rare earths landscape are powerful and long-term. The companies that thrive in this new environment will be those that recognize this shift not merely as a risk to be managed, but as an opportunity to build more resilient, innovative, and secure supply chains for the future.

About Partsimony

Partsimony is a decisive competitive advantage for elite supply chain teams. Partsimony's AI technologies seamlessly connect product design decisions with manufacturing capabilities, enabling faster production, reduced costs, and unmatched supply chain resilience.

Reach out to us at solutions@partsimony.com.

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This analysis draws from comprehensive research on the rare earth industry, global supply chain dynamics, manufacturing requirements, policy considerations, and trends. For specific questions related to your organization's manufacturing or sourcing strategy, reach out to us at solutions@partsimony.com.

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