FY24 R&D Refund Advance Received to Accelerate Pilot Plant Automation and

1. China

Mine production: 240,000 metric tons

In 2023, China’s domestic output of rare earths was 240,000 metric tons, up from 210,000 MT the previous year.

As mentioned, China has dominated rare earths production for quite some time. While China dominates global production of the vast majority of the 17 different rare earth elements, its output is heavily concentrated in light rare earths, specifically the magnet rare earths neodymium and praseodymium.

The largest rare earth mining company in the world is China Northern Rare Earth High-Tech (SHA:600111), which owns the prolific Bayan Obo rare earth mining complex in Inner Mongolia.

Chinese producers must adhere to a quota system for rare earths production. The 2023 quota for rare earths mining and rare earths separation was set at to 240,000 metric tons and 230,000 metric tons of rare earth oxides (REO) equivalent, respectively. Interestingly, this system has led China to become the world’s top importer of rare earths since 2018.

The quota system is a response to China’s longstanding problems with illegal rare earths mining. For more than a decade, the country has taken steps to clean up its act, including shutting illegal or environmentally non-compliant rare earths mines, and limiting production and rare earths exports.

China’s rare earths industry is controlled by state-owned miners, in theory allowing China to keep a strong handle on production. However, illegal rare earths extraction remains a challenge, and the Chinese government continues to take steps to curb this activity.

The Chinese government is set to introduce even tougher regulations requiring companies involved in the mining, smelting and trading of rare earths to maintain detailed records of product flow and input this data into a traceability system. These new regulations are set to take effect in October of 2024.

2. United States

Mine production: 43,000 metric tons

The US produced 43,000 metric tons of rare earths in 2023, up from 42,000 MT in the previous year.

Rare earths supply in the US currently comes only from the Mountain Pass mine in California, which is owned by MP Materials (NYSE:MP). Mountain Pass is producing high-purity neodymium and praseodymium (NdPr) oxide, a key material for high-strength neodymium iron boron (NdFeB) magnets.

The mine has had an interesting decade. Previously owned by Molycorp, the mine was put on care and maintenance in 2015 due to low rare earths prices and Molycorp filing for bankruptcy. Mountain Pass re-entered production in Q1 2018 under its new ownership.

The US is a major importer of rare earth materials. The USGS estimates the value of US rare earth imports for 2023 at US$190 million, down from US$208 million in 2022. The country has classified rare…