Australia: Key Player in the Global Rare Earth
Although Rare Earth Elements are abundant in the Earth’s crust, their extraction and processing remain highly concentrated. China leads the global supply chain, but countries like Australia are playing an increasingly important role in diversifying sources and strengthening global resilience. Australia holds approximately 6% of the world’s total known reserves, and it accounts for a 4% share of global mining production (refer to Exhibit 1).Lynas Rare Earth, headquartered in Australia, is the largest REE producer outside China and runs a major processing plant in Malaysia that supplies neodymium, praseodymium, lanthanum, and cerium. In 2025, Lynas plans to open a new processing facility in Texas, supported by the U.S. Department of Defence, as part of a broader effort to strengthen domestic supply chains and bolster national security. Australia is also actively developing its REE supply chain. Through the National Reconstruction Fund, the government has invested significantly, including support for Arafura Rare Earths in the Northern Territory to enhance mining and processing capacity. Additionally, Australian Strategic Materials (ASM) has obtained a USD 600 million Letter of Interest from the U.S. EXIM Bank to advance the Dubbo Project, further establishing Australia as a key alternative to Chinese supplies dominance.
Canada: Strategic Rise in the Rare Earth Race
Canada holds an estimated 0.9% of the world’s known REE reserves and ‘heavy’ rare earths such as neodymium and dysprosium—essential for power generation, aerospace, defence, etc. While Canada’s geological endowment positions it as a potential global supplier, its primary challenge lies in scaling up domestic mining & refining and integrating into Western-aligned supply chains. The U.S. has advanced strategic partnerships to address this, establishing the Canada-U.S. Joint Action Plan on Critical Minerals to build North American critical mineral supply chains to introduce diversity and reduce risk in the market. This includes rare earth minerals, and their alliance should help reduce the US's dependency on China’s exports of critical minerals. Canada has also signed agreements with the EU, Germany, and France, which view it as a secure alternative supplier under their Critical Raw Materials Strategy.
Furthermore, Canada is taking significant steps to develop its domestic processing infrastructure. The Saskatchewan Research Council's facility in Saskatoon is the first facility in North America to produce rare earth metals at a commercial scale, as of 2024. The country also ordered state-owned Chinese enterprises, in 2022, to divest from Canadian rare earth and lithium projects. Canada is also investing in rare earth recycling programs to extract critical minerals from e-waste and used EV batteries, supporting both environmental goals and supply chain resilience. It’s also collaborating extensively with the Arctic nations to reduce China’s efforts to gain access to REE.
Arctic: The New Rare Earth Battlegrounds
One key region that has gained heightened interest from the U.S., China, and the European Union is the Arctic. Greenland hosts some of the world's largest undeveloped deposits of rare earths and is strategically located in global supply chains. Currently, it holds approximately 1.6% of the world’s known REE reserves, and with the melting of glaciers, Greenland may report higher numbers in the coming years. Many countries are pushing to capitalise on these minerals, with the U.S. planning to propose a Compact of Free Association (COFA) to the leaders of Greenland. The U.S. and Danish officials also lobbied the developer of Greenland’s largest REE deposits not to sell its project to Beijing-linked buyers. Furthermore, Greenland has cancelled licenses linked to uranium-rich REE projects to limit Chinese involvement and reinforce ties with the U.S. and Europe.
At the broader Arctic level, Russia has the largest reserves of rare earths, accounting for nearly 4%, and contributes 0.6% to the global mining share, while also rapidly expanding its mining footprint. Additionally, Ukraine has emerged as a focal point in the struggle for rare earths. The country holds deposits of 22 of the 34 materials classified as critical by the European Union. Before the war, Ukraine was viewed as a potential alternative supplier for Europe and the U.S., capable of reducing their dependency on China and Russia. But the Russian invasion has severely disrupted mining operations, turning control over Ukraine’s critical minerals into a strategic objective. To recover from this disruption, the U.S. and Ukraine signed an agreement on April 30, 2025, establishing a Reconstruction Investment Fund. In exchange for supporting Ukraine's reconstruction, the U.S. was granted access to Ukraine's mineral resources. Under the agreement, both countries will share future profits from the sale of Ukraine's mineral and energy reserves, providing a financial incentive for the U.S. to maintain its ongoing support for Ukraine’s defence and recovery efforts.