The U.S. Acknowledges It Can't Yet Abandon Chinese Rare Earth Metals
American industry is struggling to establish its own supply chain for critical minerals by the deadline.
Starting January 1, 2027, U.S. defense contractors will be prohibited from using certain minerals from China. However, according to Reuters, domestic production and processing capacity in the U.S. is currently insufficient, so authorities may have to temporarily allow Chinese supplies or grant exceptions. China controls over 80% of the world's processing capacity for many critical minerals.
In this context, the U.S. is investing billions of dollars in its own projects and supporting the development of mines in other countries, including a new rare earth project in Madagascar. However, its launch is not expected until 2028.
This news relates to the question, "Will China impose new export restrictions on rare earth metals against the U.S. or Japan by the end of 2026?" The high dependence of the U.S. makes any new restrictions from Beijing particularly painful.
