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The US Geological Survey’s (USGS) Mineral Commodity Summary for 2026, released in February, outlines the latest picture of global rare earth resources. As of the end of 2025, total global rare earth reserves stood at approximately 85 million metric tons, with China ranking first with 44 million metric tons, accounting for about 51.7%. Brazil followed with 21 million metric tons, trailed by Australia, Russia, Vietnam, and the United States. This annual data not only confirms China’s absolute advantage in the rare earth sector but also reveals the deeper logic of global supply chain restructuring.
China: Dual Dominance in Resources and Production Capacity
China is not only the world’s largest holder of rare earth reserves but also the undisputed production leader. In 2025, China’s rare earth output reached 270,000 metric tons, accounting for 69.2% of global production of 390,000 metric tons. At the same time, China controls approximately 90% of the world’s rare earth refining and processing capacity. This dual dominance – in both mining and smelting – gives it a unique strategic deterrent power in the global supply chain.
While maintaining its advantage on the resource side, China has continued to tighten export controls on the policy front. In October 2025, China further expanded its control list, adding restrictions on five rare earth elements: holmium, erbium, thulium, europium, and ytterbium. The US-China trade truce is set to expire in November 2026. If the truce is not extended, China’s list of controlled exports could increase to 12 items.
The Chasers: Structural Mismatch Between Reserves and Production Capacity
Brazil has the world’s second-largest reserves at 21 million metric tons, but its 2025 output was only about 2,000 metric tons, with vast resources still in the development stage. Change is underway – USA Rare Earth (USAR) announced in April a $2.8 billion acquisition of Brazil’s Serra Verde, gaining the Pela Ema rare earth mine and a 15-year exclusive offtake agreement. The project is expected to reach annual production of 6,400 metric tons of rare earth oxides after Phase 1 reaches full capacity in 2027.
Australia’s reserves stand at approximately 5.7 million metric tons (USGS figure), but its output has already reached 29,000 metric tons, demonstrating significantly higher capacity conversion efficiency than Brazil. Lynas, the largest rare earth producer outside China, saw its NdPr output increase 32% year-over-year in the third quarter of fiscal 2026, and in March it achieved first commercial production of samarium oxide. Australia is consolidating its strategic position as a key rare earth supplier to Western allies, and its resources minister has indicated that a strategic reserve policy will be advanced, which “undoubtedly” includes price support mechanisms.
The United States holds only about 1.9 million metric tons of reserves, yet it is the world’s second-largest producer – output reached 51,000 metric tons in 2025, up 12% from the previous year. MP Materials, the dominant domestic player, posted record NdPr production of 917 metric tons in the first quarter of 2026, a 63% year-over-year increase. The company has launched a heavy rare earth separation facility and expects to begin producing dysprosium, terbium and other critical heavy rare earths by mid-2026. In addition, the Pentagon has invested $400 million in MP, and USA Rare Earth has received a letter of interest for $1.6 billion in funding from the Department of Commerce. However, US rare earth imports surged 169% in 2025, and net import dependence rose from 53% to 67%, indicating that building a domestic supply chain from mine to magnet will still take time.
Russia (3.8 million metric tons of reserves), Vietnam (3.5 million metric tons) and Greenland (1.5 million metric tons) also deserve attention. In 2026, Russia passed a new law raising the threshold for foreign investment in its rare earth industry, seeking to turn its resources into geopolitical leverage. Vietnam, meanwhile, passed amendments to its Geology and Mineral Law, comprehensively strengthening state control over rare earths and banning the export of raw rare earth ore. Greenland’s Kvanefjeld project has reached an impasse over disputes related to its uranium content, and in April 2026 its exploration license renewal was rejected, putting a strategic project with reserves of over 11 million metric tons on hold.
Structural Contradictions and Strategic Implications
Global rare earth supply faces a dual imbalance. First, a mismatch between reserves and production – countries like Brazil and Vietnam possess vast resources but limited capacity, while the US and Australia have significantly higher capacity utilization rates. Second, a mismatch between resources and processing capability – even as sources of raw materials become more diversified, rare earth refining and processing remain highly concentrated in China. Europe depends on China for 98% to 99% of its rare earths, a structural dependency that is unlikely to change fundamentally in the short term.
Geopolitical variables are further intensifying the tense landscape. The US acquisition push in Brazil, the capacity expansions of Lynas and MP, Russia’s tightening of foreign access, and the political stalemate over the Greenland project all point to a single trend – rare earths are evolving from a mere commodity into a key bargaining chip in great power competition. For China, its resource endowment, full industrial chain and technological lead have built a moat that is difficult to replicate. But for the global supply chain, moving from “excessive concentration” to “moderate diversification” will be an irreversible strategic imperative over the next decade.
