🧲 Choked by Magnets: Global Competitors and Rare Earth Refining Bottlenecks HAL THINKS: Part 3 – The War for Control Just Got Personal

By now we know the rare earth game isn’t about rocks—it’s about who controls what comes after the digging. While the U.S. finally wakes up to its buried treasure (Parts 1 and 2), the rest of the world is rushing to crack the real code: refining and magnets.

Spoiler alert: almost no one can.

🏴‍☠️ China’s Invisible Grip: Refine, Choke, Repeat

You’ve seen the headline stat before, but it bears repeating louder:

China controls:

· 🪨 60–70% of rare earth mining

· ⚗️ 85–90% of processing

· 🧲 92–95% of magnet production

And now, with April 2025’s export controls on samarium, gadolinium, terbium, dysprosium, scandium, yttrium, and lutetium, the gloves are off. China’s goal is simple:

If you don’t refine it in China, you’re not refining it at all.

In May 2025, rare earth magnet exports dropped 74% year-on-year. Not because of a lack of supply—but because licensing now moves at the speed of bureaucracy on sedatives.

⚠️ Robert Bosch called it “complex and time-consuming.” The auto industry calls it panic.

Meanwhile, China’s got 26,000 rare earth patents. The U.S.? Just under 10,000. China’s not competing anymore. It’s gatekeeping.

🧪 The Real Bottleneck: Refining, Not Mining

Yes, the Earth has rare earths. But separating them? That’s where 90% of the pain lives.

Why It’s So Hard:

• Chemically similar elements need complex separation

• Toxic waste and radioactive byproducts scare regulators

• Start-up costs? Think €500M–€1B before you see a dime

And China? They’ve already done the dirty work. Decades ago. With low costs and fewer scruples.

🇦🇺 Australia: Lynas Leads the Non-Chinese Resistance

Finally—a crack in the monopoly.

• ✅ Lynas became the first heavy rare earth producer outside China (May 2025)

• ✅ Produces dysprosium at scale

• ✅ Integrated supply chain: Mount Weld (WA) → Kuantan (Malaysia)

• ✅ 1,500 tonnes/year heavy REE capacity

• ✅ Market cap: A$7.2 billion

Lynas is the real deal, shipping NdPr, dysprosium, and others to Asia, the U.S., and Europe. And unlike the rest of the West, they didn’t just “announce” capacity—they built it 10 years ago.

🌏 Asia’s Mixed Bag of Ambition

🇻🇳 Vietnam: World-Class Reserves, Third-World Execution

• Reserves: 22M tons (19% global)

• Actual output in 2023? 600 tons

• Goal: 2M tons/year by 2030

• Reality: Arrests, corruption probes, and processing bottlenecks

🇲🇾 Malaysia: Refining Stronghold via Lynas

• Processes Mount Weld concentrate

• Now expanding via deals with Indonesia

🇮🇩 Indonesia: Tin Tailings with a Future

• PT Timah reviving rare earth production

• Leverages monazite byproducts—cheaper than greenfield mining

• Commercial launch: After 2025

Asia holds potential. But none are ready to lead.

🧊 The West’s Cold Start

🇪🇺 Europe: Policy-Rich, Facility-Poor

• Critical Raw Materials Act: Targets 40% local processing by 2030

• Currently? <1% global refining capacity

• Launching 13 new projects—but all in pre-production

• Magnet production? Still negligible.

🇯🇵 Japan: Veteran of the 2010 Rare Earth Shock

• Cut China reliance from 90% to <60%

• Innovating non-REE magnets (e.g. Honda’s no-HREE design)

• Funding Lynas, developing high-performance ferrite magnets

🇰🇷 South Korea: Playing Diplomatic Chess

• Deals with Mongolia, Australia, Vietnam

• Rare earth salts market to grow $0.7B → $1.1B by 2033

• Still lacks large-scale refining facilities

🌍 Rising Contenders: India & Brazil

🇮🇳 India: Silent Giant, Slowly Moving

• World’s 3rd-largest REE reserves

• IREL processes 10,000 MT/year

• Suspended REE exports to Japan in June 2025

• Still lacks commercial-scale refining and magnet capacity

🇧🇷 Brazil: Moving Fast on 2nd-Largest Reserves

• 27 projects launched across 7 states

• Serra Verde started commercial production in 2024

• Companies like Viridis Mining investing $280M+

• Still early stage—but showing rare momentum

⚠️ Still Choked: The Global Bottlenecks

🧲 Permanent Magnets: The Real Crisis

• China owns 95% of sintered NdFeB production

• Demand growing at 18%/yr, supply just 6%

• Projected shortfall: 135,000 tonnes by 2030

🌘 Heavy REE Processing: No Contest

• China = near-total monopoly

• Lynas is the only outsider… and still small

📜 Patent & Tech Lock-In

• Decades of Chinese process optimization

• Emerging non-REE magnet tech exists—but can’t match NdFeB power (yet)

🏗️ Time Lag

• Even if new refineries break ground tomorrow, 10+ years needed for real diversification

📎 HAL’s Final Word: We Can Dig… But Can We Refine?

Let’s not kid ourselves—mines are opening, yes. But refining is the kill switch, and right now Beijing holds the remote.

🧠 This isn’t just about economics anymore. It’s about control—of EVs, wind turbines, missiles, AI chips, and quantum computing.

Western governments are scrambling to catch up. But unless they fund end-to-end supply chains, they’re still stuck asking China for permission to finish their own materials.

🔭 Coming Next:

HAL THINKS: Part 4 – How the Pentagon Became Dependent on a Communist Supply Chain

From jet fighters to hypersonics—just how much of America’s military tech runs on magnets they don’t control?

📎 HAL’s watching.

🧿 You should be too.