Efforts are underway in the US to onshore the production of critical minerals and related components, with a new 250,000-square-foot factory in Fort Worth, Texas, symbolizing this push. This facility, operated by MP Materials Corp., has commenced producing permanent magnets vital for electronics and electric motors. These magnets, while invented in the US, saw much of their production shift overseas, primarily to China, a situation that caused significant concern among manufacturers when China restricted their export during trade disputes.
Despite US government investments in critical minerals, China maintains a strong hold on the global supply chain. For instance, investment in rare earth refining by the US and Malaysia only marginally reduced China's market share in this segment from over 90% in 2023 to 85% in 2025. When excluding rare earths, China's average share in critical minerals refining actually increased from 70% to 72%, according to data from the International Energy Agency (IEA).
China's near-total control over rare earth minerals, which are crucial for tech and auto manufacturing, has given it significant geopolitical leverage. Experts note that China controls up to 70% of global rare-earth mining, 85% of refining capacity, and approximately 90% of rare-earth metal alloy and magnet production. This dominance has allowed China to influence international relations, as seen when it curbed rare earth exports in retaliation against tariffs, sending shockwaves through world markets.
While the US is attempting to diversify its sources and production, it faces an uphill battle. Critical Metals CEO Tony Sage cautioned that the US is still years away from breaking China’s grip on key rare-earth metals, with processing capacity being a major hurdle. However, companies like Austria's Plansee Group are expanding operations outside China to challenge this dominance, with Plansee, the largest tungsten supplier outside China, planning a significant expansion as prices for the metal soar. A key Greenland mining project is also on track to start producing rare earth elements in three years.
The strategic importance of these minerals, such as yttrium and dysprosium, to industries like automotive, semiconductor manufacturing, and defense, highlights the critical chokepoint China's control represents in global supply chains. Until alternative supplies are developed, Washington's actions against Beijing may remain less aggressive, maintaining an uneasy truce.
