Despite Trump's intentions in Greenland World remains dependent on China for rare earths

Electric cars, artificial intelligence and even weapons - rare earths are needed everywhere. So far, China has dominated the market. According to experts, this will not change any time soon.

DPA

13.03.2025, 05:53

13.03.2025, 17:00

dpa

US President Donald Trump would like to mine them in Ukraine or Greenland in order to break China's dominance: rare earths, which are needed for electric car batteries, artificial intelligence and modern weapons systems. According to experts, however, dependence on China will remain for a long time to come. This is the conclusion of a study presented in Berlin by the German Mineral Resources Agency (Dera).

The main reason for this is the current low world market prices for rare earths. "All companies that currently mine or process rare earths are reporting economic problems," says Harald Elsner, co-author of the Dera study. "Even those in China." This makes it difficult to develop new deposits in other countries. In addition, the necessary infrastructure for mining and processing the materials is often lacking outside of China.

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Increasing demand expected

The Dera expert predicts that demand for rare earths, which are used for e-car batteries and wind turbines, for example, is likely to increase significantly in the future. "But there is still little evidence of this on the market." Accordingly, new projects outside of China are struggling in terms of profitability.

The experts are particularly critical of the so-called heavy rare earths, which are not only used in car manufacturing, but also in the US arms industry. These continue to come 100 percent from China, where they are mined or at least refined.

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Trump is eyeing deposits in Greenland

According to the experts, this is likely to be one reason for Trump's interest in Greenland. The island is said to have the world's largest deposits of heavy rare earths. However, they have not yet been mined. A China-backed rare earth project in Greenland came to a standstill after the local government banned uranium mining in 2021.

Elsner has higher hopes for deposits in Australia. Several companies have announced their intention to extract heavy rare earths from Australian ores, either directly in Australia or in Malaysia or the USA. It is true that only small quantities can be placed on the world market. But, according to Elsner: "This would significantly reduce the Western world's dependence on China for these very special raw materials."

According to the study, China accounted for around 60 percent of global rare earth production in 2023, while the share of processing was as high as 93 percent. Germany imported a total of 5,200 tons of the raw material in 2023, 71% of which came directly from China. In Germany, 90 percent of rare earths were used in catalytic converters that clean exhaust gases in cars, chemical plants and refineries.