DAILY TRIFECTA: It'd Be A Shame If Something Happened To Your Rare Earth Mine
Wild mineral chase
THE SET-UP: The conventional wisdom says Trump is ending “the rules-based world order” ushered-in by the United States at the end of World War II. Trump’s new rules are appetite-based and he’s hungry for people’s land—like the entire nation of Canada. He’s also hungry for the mineral wealth of Greenland and Ukraine. He makes no bones about it, either. And while it’s shocking in its crassness, it’s not entirely “new.”
In 1945, the US traded access to Saudi oil for security. The US coveted the Congo’s uranium, presaging the resource curse that bedevils it to this day. The US even orchestrated a coup in Guatemala to keep the United Fruit Company in the banana business. Coups were not uncommon during those “rules-based” days and, in the case of Iran, access to local resources were foremost in the minds of the CIA’s plotters.
Back then it was covert and surreptitious. Today, it is overt and swaggering. Back then it was the Cold War with the Soviet Union. Today, it’s Trump’s tariff war with China.
The one wrinkle that’s been widely overlooked in most of the reporting on the Good Cop/Bad Cop shtick Trump’s using to lock Ukrainian President Zelensky into a deal for 50% of Ukraine’s mineral wealth … is this potential bombshell from Bloomberg columnist Javier Blas:
To the best of my knowledge, Ukraine has no significant rare-earth deposits other than small scandium mines. The US Geological Survey, an authority on the matter, doesn’t list the country as holding any reserves. Neither does any other database commonly used in the mining business.
That would no doubt come as a shock to Trump. According to Blas, this wild mineral chase “began with Ukrainians themselves” as a “desperate…way to engage Trump.” So, they “talked up — way, way up — the potential of the country’s mineral resources” and ultimately “lost control of the narrative.” Trump being Trump, he ran with their hype and hyped it up to comical proportions:
On Feb. 3, Trump emphatically said the Ukrainians had “very valuable rare earths.” Always keen to be perceived as a dealmaker, he added: "We're looking to do a deal with Ukraine where they're going to secure what we're giving them with their rare earths and other things." He doubled down a few days later, telling Fox News on Feb. 11 about his talks with Ukrainian officials: “I told them that I want the equivalent like $500 billion worth of rare earth.”
Unfortunately for Trump, math is a thing:
Simply put, “follow the money” doesn’t work here. At best, the value of all the world’s rare-earth production rounds to $15 billion a year — emphasis on “a year.” That’s equal to the value of just two days of global oil output. Even if Ukraine had gigantic deposits, they wouldn’t be that valuable in geo-economic terms.
Blas notes the possibility ”Trump conflated ‘rare earths’ with the much broader concept of ‘critical minerals.’” Ukraine has “some commercial mines of titanium and gallium,” but nothing approaching $500 billion. And if it does turn out to be a wild mineral chase? Not to worry, it will always be worth $500 billion whenever he goes off-prompter. Give it a couple years and it might even grow to $1 trillion. - jp
TITLE: Trump trade conflict casts shadow over access to vital elements needed by technology sector
https://apnews.com/article/trump-tariffs-tech-trade-rare-earth-1d9cc33df97e697d744ded0a2dd5d6ad
EXCERPTS: Lithium and other elements that the U.S. needs for vital defense, energy and other applications could become harder to obtain if the Trump administration goes ahead with tariffs and other protectionist policies aimed at China.
China refines more than 90% of the global supply of so-called “rare earth elements,” which include neodymium and dysprosium. Not actually rare, these 17 elements are difficult to mine and refine because they’re not often found in concentrated deposits. Some elements, like Lithium, are usually mentioned along with rare earth elements, because they are also critical for the tech sector.
Without them, cellphones wouldn’t vibrate and computer hard drives wouldn’t operate. They’re used in wind turbines, electric cars and other industries the U.S. has sought to develop.
The U.S. imports more than 80% of its rare earth elements, with most of those imports coming from China. A trade war impacts cellphone and other tech companies making their products in China when they have to ship those products to the U.S. and pay an import tariff.
President Donald Trump imposed 10% tariffs on all Chinese imports to the U.S. earlier in February. That was on top of existing tariffs on specific Chinese goods dating back to Trump’s first term. China has since retaliated with up to 15% tariffs on a range of U.S. goods and more export controls on elements critical to the production of modern high-tech products.
Development and growth plans for smartphone makers, renewable energy companies and the broader technology sector all depend in part on access to rare earth elements. Apple has been increasing its use of recycled materials for its batteries and devices to help lower its need for newly mined and refined materials.
Demand is only expected to grow over the next few decades, especially with advances in computing power and artificial intelligence technology.
The International Energy Agency expects total demand for rare earth elements to surge 72% to 134 kilotons between 2021 and 2030. Supply requirements are expected to rise at roughly the same rate, but the total amount would lag demand at 98 kilotons.
Rare earth metals have been behind some recent geopolitical issues as the U.S. and other nations try to access sources outside of China. The U.S. is the world’s second biggest producer of rare earth metals, with about 12% of the global total.
President Donald Trump’s pitch to acquire Greenland comes amid climate change that is expected to make more of the Arctic island’s resources available. Melting ice is expected to make rich deposits of rare earth elements, lithium, and other natural resources more accessible.
TITLE: China to tighten grip on rare earth mining for non-state firms
https://www.mining.com/web/china-to-tighten-grip-on-rare-earth-mining-for-non-state-firms/
EXCERPTS: China plans to prohibit non-state companies from mining rare earths, further tightening its control over a strategic sector that has emerged as a battleground in its trade war with the US.
The government said only large state-owned groups can mine, smelt or separate the minerals and proposed banning private firms from the activities, according to draft rules issued by the Ministry of Industry and Information Technology on Wednesday.
The proposal came after the country banned the exports of several materials including germanium and gallium in a tit-for-tat move to counter the US government’s technology curbs.
Beijing also imposed new export control on tungsten and other critical metals used in electronic and defense industries in its retaliation to US President Donald Trump’s tariffs on Chinese goods.
Rare earths, a cluster of 17 elements used in everything from wind turbines to military hardware and electric vehicles, have been a feature of China’s previous trade disputes.
The Chinese government in 2023 halted the export of a range of technologies associated with processing the elements, making it harder for the US and its allies to bolster supplies of the materials.
TITLE: Help Has a Price: in Kyiv’s Case, it May be Rare Earth Minerals
https://eutoday.net/help-has-a-price-in-kyivs-case-it-may-be-rare-earth-minerals/
EXCERPTS: Of the 50 materials the U.S. deems critical, Ukraine holds deposits of 22, including graphite, lithium, titanium, beryllium, and uranium—key resources for batteries, radar systems, and armor. Access to such a substantial stock of key minerals could be a game changer for the U.S., which–like the EU–is seeking any avenue to reduce its dependence on China, which currently dominates rare earth production and processing.
While Trump openly couples military aid with resource access, German Chancellor Scholz presents a different vision. He recently criticized Trump’s approach as “egotistical and self-serving,” arguing that Ukraine should retain its natural resources to finance post-war reconstruction rather than use them as collateral for military support. This stance, while principled, raises an important question: where does this leave Europe, which needs access to many of the same minerals? As the U.S. pushes ahead with its own self-interested mineral strategy, Europe risks being left behind, without a clear plan to secure its own supply chains.
Meanwhile, China has built a near-monopoly over critical minerals, producing 60% of the world’s rare earth elements and processing 90% of them. This reality underscores Europe’s fragile position. The EU’s Critical Raw Materials Act, intended to reduce dependency on external suppliers, is a step in the right direction but lacks the necessary investment and strategic clarity to make a real impact. Europe speaks of resilience while Washington and Beijing act.
Against this backdrop of European hesitancy, Mongolia’s evolving resource strategy offers a revealing contrast. The landlocked country, rich in copper, uranium, fluorspar, and rare earth elements, has emerged as a key player in the global critical minerals landscape. Just a few years ago, Mongolia appeared ready to adopt resource nationalism, taking an increasingly hardline stance that risked putting off Western investors. The Oyu Tolgoi mining project – once marketed as a flagship collaboration – left Mongolia burdened with debt and delayed profits, fueling domestic discontent and demands for greater autonomy over national resources.
However, the combination of mounting international pressure and Mongolia’s economic vulnerabilities signaled for a significant recalibration. The recent investment agreement between the Mongolian government and France’s Orano signals this shift: by securing preferential shares and royalties amounting to 19% of Orano’s revenue, Mongolia prioritized steady revenue flow over outright ownership. It is a pragmatic compromise aimed at balancing foreign investment with national benefit.
The evolution of Mongolia’s approach highlights two important realities. Firstly, resource-rich nations are increasingly emboldened by what they see as Western indecision, and secondly, the global scarcity of critical raw materials caps how far such assertiveness can go. The example of Mongolia reads as a cautionary tale for both resource holders and import-dependant countries. For Europe, it underlines the risks of strategic passivity; for Ukraine, it illustrates the delicate equilibrium between leveraging natural wealth and preserving long-term sovereignty.
Europe’s response has so far been slow and fragmented. The EU’s Global Gateway initiative and efforts to negotiate new trade agreements with resource-rich nations signal intent, but execution remains slow. Without a coherent industrial strategy, Europe risks becoming an observer while other global players secure their economic futures.
The stakes are high. Industries dependent on rare earth minerals—defense, renewable energy, consumer electronics—are facing increasing global competition. As the EU’s energy transition accelerates, demand for materials like lithium and rare earth elements will continue to rise. Without a concrete plan, Europe may find itself at the mercy of geopolitical shifts and resource diplomacy – a position that Ukraine’s mineral wealth could help mitigate if managed strategically.
BTW: Speaking of being “at the mercy of geopolitical shifts and resource diplomacy” …Europe has the additional complication of relying on a “controversial minerals deal” with Rwanda. And that’s sucked them into the rolling catastrophe that is the DR Congo. Eunews explained the cluster-you-know-what thusly:
In the resolution adopted [on February 13th] with 443 votes in favor, four against, and 48 abstentions, MEPs strongly condemned the occupation of Goma and other territories in eastern DRC — a region rich in minerals — by M23 rebels and the Rwandan army. In the text, the European Parliament underlines the “indiscriminate attacks, unlawful killing, rape, and other apparent war crimes” that have occurred in recent weeks on the DRC-Rwanda border. Over 3,000 people are reportedly dead in the city on Lake Kivu.
The violence is an embarrassment for the European Commission, which recently intensified relations with Kigali. Direct financial assistance measures and military support through the European Peace Facility to Rwandan troops deployed in northern Mozambique: MEPs call for a halt to this, at least until Kigali “breaks all links with M23.” Most importantly, Strasbourg is calling for the immediate suspension of the EU-Rwanda Memorandum of Understanding on Sustainable Commodity Value Chains, signed only a year ago, “until Rwanda ceases all interference in the DRC, including exporting minerals mined from M23-controlled areas.” Those minerals are “bloodstained,” warns the European Parliament.
The February 2024 agreement with Kigali is part of the global race to supply materials critical for the ecological transition, with Brussels trying hard to reduce dependence on China. It aims to secure a “sustainable supply of raw materials” for the European Union – primarily tantalum, tin, tungsten, gold, niobium, lithium, and rare earths – in exchange for substantial funding to develop Rwanda’s mining supply chains and infrastructure. Through the Global Gateway — the strategy launched by the EU in 2021 to create new infrastructure in developing countries — Rwanda has been allocated over €900 million.
The understanding sparked controversy from the start since the United Nations documented the illicit trade in minerals coming from a conflict-torn border region. The president of the Democratic Republic of Congo, Félix Tshisekedi, defined the agreement between Brussels and Kigali as a “provocation in very bad taste.” The incursion by Rwandan-backed rebels has been concentrated in the region most dense with mines for extracting gold, coltan, tin, tantalum, and other critical minerals and rare earths.
For now, the European Commission chooses the line of pragmatism. It takes a position on the conflict but will not touch the memorandum of understanding.