The blather in the media suggesting that China could or already be weaponizing the export of their “rare earths” to the rest of the world is so one-sided that it must make the Chinese wonder if non-Chinese “analysts” and “experts” ever bother to see the world from the perspective of “others.” For more than a decade China has been aggressively acquiring outright or buying the output of non-Chinese rare earth sources. At this point in time, China is the overwhelming buyer, worldwide, for example of the mineral monazite, which is produced primarily as a byproduct of the processing of heavy mineral sands, which are the source of zircon and ilmenite, source minerals for, respectively, zirconium and titanium.

We can speculate that China seeks heavy mineral sands for its world-dominating production of zirconium and titanium and that the rare earths are just an added extra attraction. But my survey of actual China experts, not those who’ve never been to China and work for “intelligence” gatherers and purveyors, tells me that China is focused on conserving its own rare earth resources and responding to internal pressure to clean up its massive rare earth industry’s pollution problems. We know that Baotou’s famous operations now include extracting rare earths from the massive tailings produced over the last 30 years of poor quality mining and that China Nuclear has been licensed to process up to 50,000 tons per year of monazite to recover up to 30,000 tons per year of total light rare earths while removing the uranium and thorium from the monazites, which typically contain up to 50% more of the desirable magnet precursors, neodymium and praseodymium, than Baotou’s (and MP Materials Corp.’s (NYSE: MP)) bastnaesite.

China has now also essentially shut down its domestic heavy rare earth production from its ionic adsorption clays due to environmental degradation from their in-situ processing. China gets the majority of its heavy rare earths from Myanmar ionic adsorption clays today. The production of the first Western ionic adsorption clay producers, in Burundi and Brazil, is already pre-sold to China.

Australia has the world’s first hard-rock heavy rare earth mineral mine, that of Northern Minerals Limited’s (ASX: NTU) xenotime deposit in Western Australia. It is controlled by Chinese interests.

China is doubling the size of its rare earth permanent magnet industry. It is said that this will happen by 2025.

This means that China needs more, much more of the magnet precursor rare earths and all of the heavy rare earths, in particular, that it controls.

It is the domestic Chinese market, the market of the Belt and Road countries, and the rest of the non-aligned with China world, in that order that is driving the Chinese rare earth markets with emphasis on value added in China.

When Western, Japanese, and Korean governments announce that they want to be independent of China for rare earth permanent magnet products, the Chinese simply calculate when, in the best and worst cases, they will no longer have demand for rare earth enabled products from those countries and focus on their key domestic and allied markets.

It is very unlikely that Western car and appliance makers will be able to replace any substantial quantity of Chinese sourced rare earth permanent magnet motors by any of the ridiculously short-sighted timelines dictated by government mandates. In fact, as is already happening in Europe, it is likely that Chinese EV makers will outcompete European car makers in their (European) home markets due to their cost and critical minerals availability advantages.

The United States is woefully unprepared for the EV transition. But the 25% Trump tariff on Chinese imported cars is helping stave off a Chinese tsunami in the US car market.

2030 is fast approaching, and it’s hard to see how the automotive and appliance industries are going to decouple from China.

Energy Fuels takes giant step towards complete, in-house, vertical integration in the production of rare earth permanent magnet alloys

Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR) has just this week announced that it will buy, subject to due diligence, a huge Brazilian deposit of heavy mineral sands, which it will mine to produce a concentrated mineral mix that will contain zircon, ilmenite (titanium), and monazite. This concentrate is expected to be sold to partner companies, which will extract the zircon and ilmenite as payables, and the residual monazite, a waste product in zircon/ilmenite processing, will be conveyed at a nominal cost (as part of the arrangement to supply the heavy mineral sands to partners) to Energy Fuels’ White Mesa, Utah, where the monazite will be cracked and leached to extract a clean rare earth content as a mixed carbonate and to extract and sell or legally dispose of its uranium and thorium content.

Energy Fuels is already buying, and processing monazite produced in the above way from the zircon/ilmenite operations of Chemours in Georgia, but the Brazilian purchase will allow Energy Fuels to diversify and lower its cost of monazite concentrates.

The in-house production of monazite rich heavy mineral sands by Energy Fuels will be the foundation of its program for the vertically integrated (in-house) production of rare earth metals and alloys from (in-house) separated and purified individual and blended rare earth salts.  

Energy Fuels operates the only operating uranium processing “mill” in the United States and the only facility in the United States in the U.S. capable of processing monazite for the recovery of uranium for sale to nuclear power plants, and the recovery or legal disposal of the thorium and other radionuclides associated with monazite. 

The company has already begun processing purchased monazite into a mixed rare earth carbonate, and currently has the capacity to produce thousands of tons of such mixed rare earth carbonates per year. Energy Fuels’ mixed carbonate is the most advanced rare earth product being produced at a commercial scale in the U.S. today. The company is also making major strides in producing separated and refined individual and blended rare earth products at its mill.

Comparatively, monazite contains up to 50% more of the recoverable core magnet metals, neodymium and praseodymium than the bastnaesite mined at Mountain Pass, California.

Energy Fuels is finalizing a scoping study for a dedicated, rare earths, solvent extraction separation system and is finalizing the commercialization of a new rare earth metals and alloys production process demonstration.

Within 24-36 months Energy Fuels has the potential to be the world’s lowest-cost producer of separated individual rare earths and will therefore the lowest cost producer of rare earth metals and alloys. No government subsidies have been needed. Just managerial knowledge, experience, and skill. 

Energy Fuels already is a major domestic supplier of uranium and vanadium In fact, the company announced at its AGM, earlier this week, that it has signed a decade long supply deal with two American utilities to provide them with more than 4,000,000 lbs of uranium. This contract will bring in more than USD$200,000,000 over its life. 

Energy Fuels is a producing and growing domestic American critical metals processing hub.

Disclosure: Jack Lifton is a member of  the Advisory Board for Energy Fuels Inc., and may hold securities or options in some of the companies mentioned in the above article.