Rare Earths Warrant Geopolitical Focus
False Assumption: Rare earth elements are scarce enough to justify intense geopolitical competition, foreign policy maneuvers, and massive investments due to their critical role in green technologies.
Written by FARAgent on February 11, 2026
From 2020 to 2022, talk of rare earths surged. Supply disruptions from COVID, electric vehicle demand, China's export curbs, and green tech excitement doubled global revenue. Speculators piled in amid promises of strategic importance for iPhones, Teslas, and wind turbines.
The bubble burst in 2024. Revenue fell below $4 billion, a mere 0.1% of oil and gas revenue. Biden's push for mining in California and processing in Texas met Chinese price cuts that punished foreign ventures. Environmentalists had blocked domestic efforts for decades.
Today, forecasts see 10% annual growth, but rare earths abound in the crust. They concentrate poorly and pollute heavily during extraction. China leads because it ignores hazards. Organizing foreign policy around them looks foolish given their commonality.
Organizations Involved
The Chinese government took control of rare earth mining and refining. It tolerated heavy pollution that other nations shunned. This let China flood global markets with cheap supplies and undercut competitors. Environmental groups in the U.S. pushed back against domestic efforts for years. They blocked production until the Biden administration stepped in with new initiatives. Growing evidence suggests this dominance stemmed less from true scarcity and more from environmental trade-offs, though the debate lingers. [1]
▶ Supporting Quotes (2)
“China currently dominates mining and refining of rare earth elements because the Chinese government doesn’t care as much about pollution.”— The Rare Earth Bubble Is Over
“after decades of hassling by environmentalists”— The Rare Earth Bubble Is Over
The Foundation
Rare earth elements gained their aura of criticality from their misleading name and forecasts of surging demand for clean energy tech. Electric vehicles, for instance, were said to need six times more minerals than traditional cars. Projections for EVs and wind turbines bolstered fears of shortages. In truth, these elements abound in the earth's crust but cluster in low concentrations that demand polluting separation processes. Increasingly, experts recognize these assumptions as flawed, overlooking the minerals' abundance amid extraction hurdles, yet consensus on this shift remains incomplete. [1]
▶ Supporting Quotes (2)
“Contrary to what the name suggests, REEs are abundant in the earth’s crust. The catch is that they come in low concentrations in minerals, and even when found, they are hard to separate from other elements, which is what makes them “rare.””— The Rare Earth Bubble Is Over
“An electric car requires six times the mineral inputs of a conventional car, and a wind plant requires nine times more minerals than a gas-fired plant.”— The Rare Earth Bubble Is Over
How It Spread
Media outlets and policy circles hyped rare earths through stories tied to conflicts in Ukraine, Greenland, and Canada. The narrative peaked between 2020 and 2022 as revenues doubled from COVID supply snags, EV booms, and green tech enthusiasm. This amplification spread the idea of geopolitical urgency far and wide. Growing evidence now points to hype over substance in these discussions, though not all agree the scarcity fears were entirely misplaced. [1]
▶ Supporting Quotes (1)
“You hear a lot about rare earths these days: in Ukraine, in Greenland, in Canada.”— The Rare Earth Bubble Is Over
Resulting Policies
The Biden administration rolled out plans to mine rare earths in California and process them in Texas. These moves rested on beliefs in strategic shortages vital for green transitions. Such policies aimed to counter foreign dependencies amid tech demands. Evidence is mounting that these efforts addressed an overstated problem, with scarcity increasingly seen as illusory, but the policy rationale still holds sway in some quarters. [1]
▶ Supporting Quotes (1)
“as the Biden Administration promoted rare earth mining in California and processing in Texas”— The Rare Earth Bubble Is Over
Harm Caused
Speculators and overseas investors faced heavy losses when the market tanked in 2024. Revenues sank below $4 billion after the 2020-2022 bubble burst, hit by Chinese price wars. Extraction polluted communities with toxic waste and health risks, which scared off non-Chinese producers and fed illusions of import reliance. Growing recognition highlights these harms as products of misplaced geopolitical fixation, though debates persist on the full extent. [1]
▶ Supporting Quotes (2)
“the dominant Chinese responded with lower prices to punish foreign investors.”— The Rare Earth Bubble Is Over
“Both methods produce mountains of toxic waste, with high risk of environmental and health hazards.”— The Rare Earth Bubble Is Over
Downfall
By 2024, global revenues for rare earths dropped under $4 billion, dwarfed by the $4 trillion oil and gas sector. Supply chains stabilized, and China slashed prices, popping the bubble. Revelations about the elements' commonality eroded scarcity myths, despite ongoing processing woes. Increasingly, this is seen as exposing the geopolitical obsession as overblown, but the assumption's flaws are not yet universally accepted. [1]
▶ Supporting Quotes (2)
“the market came crashing back down to earth in 2024”— The Rare Earth Bubble Is Over
“It seems pretty crazy to organize foreign policy around rare earths, because they are so common.”— The Rare Earth Bubble Is Over
Sources
-
[1]
The Rare Earth Bubble Is Overreputable_journalism