Washington Secures $8.5 Billion Rare-Earth Pact as China Tightens Export Curbs

7 articles · Updated · Fortune · May 26

$8.5 billion in new U.S.-Australia cooperation anchors Washington’s push to build non-Chinese rare-earth supply chains after Beijing’s latest export restrictions exposed industrial and defense vulnerabilities.
China controls about 70% of global rare-earth mining and nearly 90% of refining, and earlier curbs on samarium, dysprosium and terbium had already pushed U.S. automakers close to production stoppages before a partial truce.
The Pentagon is now MP Materials’ largest shareholder at Mountain Pass, while the administration has also struck deals with Malaysia and Thailand and is weighing shifting $2 billion of CHIPS Act funds toward minerals.
McKinsey projects up to a 30% global shortfall in magnetic rare earths by 2035, with producers outside China expected to meet less than 20% of demand for dysprosium and terbium.
Even with faster policy support, the U.S. remains only a few steps into a long mine-to-magnet buildout, leaving diversification likely to take years rather than one administration.

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