The United States faces challenges in competing with China over rare earth minerals — a crucial industry for advanced technologies, national security, and economic growth.
At the January 13 Rotary Club of Norfolk meeting Ian Murphy, a China subject matter expert with SecuriFense, explained that rare earth minerals are essential for the manufacturing of computers, smartphones, electric vehicles, renewable energy systems, and critical defense equipment. Their unique properties make them irreplaceable in high-performance magnets, batteries, and military hardware. Because so many products and industries depend on these materials, securing a reliable supply is vital for innovation, competitiveness, and security.
Murphy pointed out that the 17 rare earth minerals are actually not always scarce. But the United States faces hurdles in economically mining and refining them. In the 1960s to 1980s, the U.S. led the world in rare earth minerals. But environmental and regulatory issues caused a decline, resulting in outsourcing operations to China. New operations in the U.S. will take up to 20 years to become fully functional.
China dominates the global rare earth industry, controlling 70 percent of its supply through the China Rare Earth Group, a state-owned entity. China exports finished products and maintains tight control, using a sophisticated export licensing regime. China mandates that any product containing even a small percentage of Chinese rare earths are subject to China’s export laws, further increasing its leverage. Temporary export licenses valid through October 2026 offer limited relief, as China continues to administer quotas and maintain political and economic control.
Murphy emphasized that the U.S. is running out of time to rebuild its rare earth supply chain and talent pool and can no longer rely on market-driven trade. Key recommendations include: mapping supply chains, preparing for rising prices, stockpiling minerals as a short-term solution, investing in global partnerships, and supporting circular economies such as electronics recycling in Virginia.
