AP Business Writer Josh Funk
OMAHA, Nevada (AP) — America’s only rare earth mine heard from an uneasy company shortly after China responded to President Donald Trump’s tariffs this month by restricting exports of minerals used in military applications and minerals used in many high-tech equipment.
“The effect was immediate, based on the number of calls we received,” said Matt Slusher, a spokesman for MP Materials, who runs the Mountain Pass Mine in California’s Mohab Desert.
If China maintains export controls or expands them to seek the benefits of trade negotiations, the trade war between the two biggest economies of the world could lead to a significant shortage of rare earth elements. As California mines are unable to meet all US demand for rare earths, Trump is trying to clear his path to a new mine.
Rare earth elements are important components of electric vehicles, powerful magnets, advanced fighter jets, submarines, smartphones, television screens and many other products. Despite their name, the 17 elements are not in fact rare, but it is difficult to find them with enough concentration to create a mine worth investing in.
Tariffs affect the supply and costs of minerals
MP Material, which acquired Idol Mountain Pass Site in 2017, said Thursday it would stop sending ore to China for processing due to export restrictions and 125% tariffs on US imports China. The company said it will continue to process almost half of the mines on the site and function to increase its processing capacity while preserving the rest.
“Selling valuable and important minerals at a 125% tariff is commercially reasonable, but not consistent with US national interests,” the MP document said in a statement.
Experts say manufacturers relying on rare earth elements and other important minerals will see prices rising, but for now there could be enough global supply available to keep the factories operating.
The California mines generate Neodymium and Praseodymium. This is a light rare earth, a major component of permanent rare earth magnets in EVs and wind turbines. However, small amounts of heavy rare earths that China has limited, such as terbium and dysprosium, are key to helping magnets withstand high temperatures.
Already, since the end of March, terbium prices have increased 24% to $933 per kilogram.
“Our estimates suggest that there is enough stockpile in the market to maintain demand for now,” said Neham Keljee, a benchmark mineral intelligence rare earth analyst, adding that a shortage could emerge later this year.
China holds power in the market
China has incredible power over the rare earth market. The country has the largest mines, producing 270,000 tons (297,624 tons) of minerals compared to 45,000 tons (40,823 metric tons) mined in the US China last year.
The restrictions introduced by Beijing on April 4 require seven heavy rare earth exporters and several magnets to obtain a special license. Retaliation control strengthened what the Trump administration and manufacturers view as a disastrous need to build additional US mines and reduce the state’s dependence on China.
Trump has so far tried to strengthen his arms in Greenland and Ukraine, providing the US with more rare earths and other important materials. Last month he signed an executive order calling for the federal government to streamline approval for permits for new mines and encourage investment in the project.
The two companies are looking to develop mines in Nebraska and Montana. Officials of Niocorp and U.S. Key Documents said they hope that push from the White House will help them raise funds and get the approval they need to start drilling. Niocorp has worked for many years to raise $1.1 billion to build a mine in southeastern Nebraska.
“When I sit down and think about how I can deal with this enormous leverage, I think that I have these minerals that I don’t even know how to pronounce most of these minerals. We have to deal with this leverage situation.” “And I think the best way is to create our own heavy rare earth here in America, and we can do that.”
MP Documents are working to quickly expand its processing capacity with the help of around $45 million that came out of the first Trump administration. However, after investing nearly $1 billion since 2020, the company currently lacks the ability to handle heavy rare earths that China has limited. MP materials have said they are working quickly to change it, and have built a factory in Texas to produce rare earth magnets for electric vehicles and other products domestically, removing China’s control in that market.
Large US automakers declined to comment on how dependent they are on rare earths and the impact of China’s export curbs. Major defense contractors such as Boeing and Lockheed Martin remained cautious as they, along with more than a dozen other defense and aerospace companies, were specifically targeting China’s restrictions.
Military technology is a small but important user of rare earths. Trump issued an executive order on Tuesday, calling for an investigation into the national security impact of being highly dependent on China on its elements.
A spokesman for Lockheed, which manufactures the F-22 fighter jet, said the company is continuing to evaluate “the global rare earth supply chain to ensure access to critical materials that support its customers’ missions.”
Manufacturers are preparing for price increases
Some battery manufacturers can let go of key elements within a few weeks, according to Steve Christensen, executive director of the Responsible Battery Union, an association representing batteries and car manufacturers and battery sellers.
Already, manufacturers have seen the prices of antimony, an element used to extend the lifespan of traditional lead-acid batteries since China restricted exports last year. This element is not one of the 17 rare earths, but one of the important minerals that Trump wants to see what was produced domestically.
Initially, carmakers could try to absorb the increased battery costs without increasing vehicle prices, but it may not be sustainable if China’s restrictions remain. The rate for 25% of Trump to fit all imported cars and car parts cars was already expected to raise costs, but the president suggested this week that he might give the industry a temporary reprieve.
The US met rare earth needs with domestic sources until the late 1990s. Production was primarily terminated after low-cost Chinese ore flooded the global market. Robots, drones and other new technologies are rapidly increasing the demand for raw materials.
Niocorp recently signed an agreement this summer to carry out more exploratory drilling to prove to the Export Transport Bank that there is sufficient rare earth minerals underground near Elk Creek, Nebraska, and to justify the $800 million loan to help fund the project.
However, the new rare earth mines have been away from operations at Niocorp in the US for years. If everything is going well with fundraising, it is possible that a niobium, scandium, titanium and rare earth assortment of niobium, scandium, titanium and rare earths will be running by the end of President Trump.
The key US materials are planning to excavate several tons of ore in Montana this summer, allowing us to test the processing methods under development. The Sheep Creek Project is less than the Nebraska Project, but Harvey Kay, the US Director of Critical Materials, said the site has high concentrations of rare earth promising ore deposits.
Original issue: April 18, 2025 2:01pm EDT
