Rare earths
Ford was days from shutting a line when China cut the refined stack. The United States is building a producer industry into that fact — on a clock measured in years, with a January deadline in front of it.
Last April, China announced it would cut off exports of some critical materials to the United States. Ford was within days — “literally days,” in Dan Dreyfus’s telling — of shutting the entire production line. The Department of War and the Department of Energy, he said, went into a panic.
Last April, China announced that they were going to cut off exports of some critical materials to the US… we learned that the Ford Motor Company was within days, literally days of their entire production line shutting down.
Dan Dreyfus, June 2026
The United States is 100 percent import-dependent on China for 15 critical minerals. China holds about 80 percent of global rare-earth refining, about 85 percent of separation, and more than 90 percent of magnet production. Ore can be dug in Australia or Africa. It still goes to China to become a magnet. Wayne Sanders, the same Bloomberg Intelligence voice on magazine depth, named “the deal with MP materials” as the domestic onshoring answer to China holding “sometimes 85, even 90% of the supply chain” on those oxides — terbium, dysprosium, neodymium magnets. Independent color on a deal the page already tracks. It is not a Litinsky restatement, and it does not re-date MP.
The metals that matter for heat-tolerant magnets are the heavies — HREE, heavy rare earth elements, chiefly dysprosium and terbium. The workhorse feedstock is NdPr, neodymium-praseodymium oxide. China turned the tap on both.
The license, the price, the date
The April 2025 controls covered dysprosium at 41 percent of global supply, terbium at 49 percent, and yttrium at 42 percent. China’s commerce ministry now reviews export licenses case by case, on a 45-working-day clock. Military end-use denials are explicit. The industry ministry can fine up to five times illegal gains and pull a license for overruns above 30 percent.
NdPr is up about 160 percent this year — from about $53 a kilogram in January to $108–142 in May. A second wave of extraterritorial controls, announced in October 2025, was suspended until November 10, 2026. The Busan trade truce then moved that pause to January 10, 2027 — two months, not a China HREE export halt and not a rare-earth grand bargain. The May Trump–Xi summit produced no operational rare-earth concessions. The April controls were never suspended.
Reuters, via a September 4 recap the wiki filed on reopen week, put a later date on the same license spine. Some Chinese rare-earth suppliers have refused US shipments since early August, after Beijing sanctioned the Responsible Business Alliance. Yttrium, indium phosphide, and tungsten remain near record highs. China exported no terbium to Japan from January through August — against 20 tons a year earlier. Xi is expected in Washington on September 24. That is halt-and-licence color. It is not a realized MP shipment, and it does not re-date the producer stack.
A law that is not a cut
On June 15 a different instrument landed. China’s revised Mineral Resources Law — State Council Order 839, seventy-nine articles — took effect that day. The ministry held a briefing and called it a “one law and one regulation” system. Trade desks had spent the spring treating June 15 as a production cap: Beijing would be able to shrink global rare-earth output, not just decide who gets an export license.
The fetched statute does not do that work. Article 5 sets a catalog process — the ministry proposes, the State Council approves — and lets the government apply planning control and total-quantity regulation to “specific” strategic minerals the Council later names. The official Chinese text does not say rare earths. It does not list thirty-six minerals. Asian Metal and a Beijing paper, the same week, claimed the ordinance itself put rare earths, tungsten, lithium, cobalt on a thirty-six-item list with five rigid constraints. That list is not in the law the wiki fetched. Leave both on the table.
The ministry’s own next step points the other way. Huang Xuexiong talked about raising reserves and output, more domestic exploration, a fifteenth Five-Year mineral plan. A CAITEC researcher told Global Times the rules “should not be interpreted as tightening measures.” Rare-earth quotas still live on a parallel industry-ministry system. No public 2026 second-batch mining or smelting notice showed up after June 15. The April 2025 licenses and the April 29 penalties remain the forcing function. June 15 is legal infrastructure. It is not a fetched production cut.
China’s share of the refined stack
Separation is filed at about 85 percent. Ore mined elsewhere still tends to flow through Chinese refineries.
One mine, a long clock
MP Materials runs Mountain Pass in California, the only rare-earth mining and processing complex in the United States. The heavy-rare-earth circuit is supposed to begin commercial terbium and dysprosium production in the second half of 2026 — 200 metric tons a year of the two combined. The Pentagon has a $150 million loan and 15 percent ownership. James Litinsky, the chief executive, says access to NdPr oxide remains the binding constraint for non-China magnet production for at least five years, and that the dysprosium-terbium circuit is “on track to begin shipping product from Mountain Pass to Independence later this year.”
The second-quarter print does not yet look like a monopoly. Adjusted earnings were a one-cent loss. NdPr production was 840 tons, up 41 percent from a year earlier, with sales over 1,000 tons. A “sizable nine-figure” gadolinium-oxide contract validates a locked-in, non-spot pricing model on a heavy-rare-earth byproduct. It does not yet price terbium or dysprosium. Reuters, in late September, said MP had begun delivering magnets made from its own refined rare earths to General Motors — the 2021 deal, not an Independence Dy/Tb shipment. The Q2 call still guides commercial magnet shipments for the fourth quarter. Independent press on a path already dated. It is not an MP IR confirmation of the heavy-rare-earth circuit.
USA Rare Earth closed Serra Verde in Brazil on September 3, 2026 — about $2.8 billion, with $1.6 billion of government funding. A close is not integration. Pela Ema is still in optimization and commissioning. Critical Metals has $354 million of Pentagon contracts at Tanbreez in Greenland. Energy Fuels produced a first domestic dysprosium-oxide sample. Tomasz Nadrowski, on a Columbia Energy Exchange episode, put the Western response on a different clock: if we start now, results in 10 or 15 or 16 or 17 years. Mountain Pass has still not started commercial terbium or dysprosium. The 10-Q still says “expect to begin” in the second half. Lynas’s US-markets page claims it is the world’s only commercial producer of separated light and heavy rare-earth oxides outside China. That is Lynas talking. It does not make Mountain Pass a shipment.
Audrey Robertson, assistant secretary at Energy, put the same bind on a later Columbia episode as processing, not rock. The United States has “plentiful resources of actual… raw rock that can become copper. But we only have three copper smelters in this country in the last decade. China’s built 42, I believe. It doesn’t matter if we have copper in the ground here if we can’t turn it into a usable resource.” Recycling: “We send all our black mass back to China because they have the facilities to process and refine in a way that we don’t yet.” The country produces no gallium; after a funding opportunity, she said, five companies will extract it from existing American assets. Graphite, copper, and aluminum she framed as “intentional economic warfare around making them uneconomic at any cost.” Jason Bordoff, hosting, named MP Materials and the processing-versus-mining gap. That is DOE first-party on a bottleneck this page already tracks. It is not a new chain, and copper-for-AI halls stay on the materials article.
Drones as a demand pulse
Litinsky treats the Middle East as an accelerant. The future of warfare, he said, will involve “millions, eventually billions, of robots and drones,” all of them hungry for magnets. Project Swarm is an attempt to book that demand early — subscription agreements with drone makers that “preserve flexibility.” A subscription that preserves flexibility may not be a purchase order. Walter Russell Mead, on Invest Like the Best the same reopen week, brought a practitioner demand vector from a Ukraine factory visit: “I talked to people who said that they don't treat bullet wounds anymore. It's all drones.” A gray kill zone. A 63-day evacuation. Tanks and rifles as obsolescence color. Independent of Litinsky. Not an offtake. Not a new ticker.
Unitree, a Chinese humanoid maker, is a separate commercial pull on the same oxides. The defense story and the factory-robot story converge on the same constraint. Neither has yet shown up as terbium or dysprosium pricing.