Mining Executive Calls for Urgent Action on Rare Earths
Rafael Moreno, head of a mining company with a new demonstration plant in Brazil, has declared it “paramount” to end China’s stranglehold on rare earths supply. His statement comes as President Donald Trump and China’s President Xi Jinping prepare for their second summit of the year on Thursday. Moreno emphasized the market is “nervous” amid renewed threats from Beijing to ban rare earth exports. These materials are critical for cars, wind turbines, and military jets.
Moreno’s company aims to supply the European Union with rare earths within two years, offering an alternative to Chinese dominance. He stressed that a deal between Trump and Xi is “imperative” to ease tensions and prevent export restrictions. The summit represents a pivotal moment for global supply chains, as industries across the West rely heavily on Chinese processed rare earths. Moreno’s comments highlight growing concerns over dependency on a single supplier.
China’s Dominance in Rare Earths: A Historical Perspective
China has long controlled the majority of rare earth mining and processing, accounting for over 60% of global production and nearly 90% of refining capacity. This dominance stems from decades of investment in extraction technology and lower environmental standards. Western nations, including the United States and EU member states, have repeatedly attempted to diversify sources but faced significant hurdles. The strategic importance of rare earths has escalated with the rise of electric vehicles and advanced defense systems.
Past export restrictions by China, such as the 2010 dispute with Japan, have demonstrated the leverage Beijing holds over global markets. These episodes prompted early efforts to develop alternative supply chains, but progress has been slow. Industry analysts note that building new mining and processing facilities requires substantial capital and years of regulatory approvals. Moreno’s project in Brazil represents one of the most advanced attempts to break this dependency in the Western Hemisphere.
The Trump-Xi Summit: Trade and Rare Earths on the Table
The upcoming Trump-Xi meeting is expected to address a range of trade disputes, with rare earths likely a key point of negotiation. Moreno said a deal is “imperative” for Beijing to lift its threat of export bans, which have already caused price fluctuations. Market participants are watching for any signals of a breakthrough or further escalation. The summit’s outcome could determine whether global manufacturers face new supply disruptions or gain much-needed certainty.
Trade experts suggest that rare earths have become a bargaining chip for China in broader negotiations, including tariffs and technology transfers. Trump’s administration has previously considered stockpiling rare earths and supporting domestic production, but legislative progress has been limited. Moreno’s Brazilian operation offers an alternative that could reduce pressure on U.S. and EU policymakers. However, scaling up production to meet global demand remains a complex challenge.
Brazil’s Emerging Role in Rare Earths Supply
Moreno’s company has opened a demonstration plant in Brazil, which is rich in rare earth mineral deposits. The facility aims to produce separated rare earths, a step that many Western projects have struggled to achieve. If successful, it could provide a new source for EU manufacturers seeking to reduce reliance on China. The plant’s location in Brazil also offers logistical advantages for transatlantic trade, potentially lowering shipping costs and lead times.
Brazilian regulators have shown support for the project, viewing it as an opportunity to boost local mining and processing capabilities. The company plans to ramp up production over the next two years, targeting initial output for European buyers. Industry analysts note that Brazil’s rare earth reserves are substantial, though extraction and processing expertise is still developing. Moreno’s team is optimistic about overcoming these challenges with modern technology and partnerships.
Economic and Defense Implications of Rare Earth Dependency
Rare earths are essential for a wide array of high-tech products, including smartphones, electric vehicle batteries, and wind turbine magnets. Defense applications are equally critical, with rare earths used in precision-guided munitions, radar systems, and fighter jet components. A supply disruption could have cascading effects on both civilian industries and national security. The European Union has identified rare earths as a strategic priority, aiming to secure supply chains by 2030.
The market’s nervousness, as described by Moreno, reflects the fragility of current supply chains. Any export ban by China could trigger price spikes and shortages, affecting everything from consumer electronics to military procurement. Western governments have launched initiatives to stockpile rare earths and fund research into recycling and substitutes. However, these measures are still in early stages, leaving industries exposed to geopolitical volatility.
Future Outlook and Industry Response
Moreno’s call to end China’s stranglehold is echoed by industry groups and policymakers across the EU and United States. Several new mining projects are underway in Australia, Canada, and the United States, but processing capabilities remain a bottleneck. The Brazilian plant is one of the few that aims to handle both extraction and separation, which could give it a competitive edge. If successful, it may inspire further investment in Western Hemisphere processing facilities.
The outcome of the Trump-Xi summit will likely influence the pace of these efforts. A trade deal could temporarily ease tensions, while a breakdown might accelerate diversification plans. Moreno remains confident that his company can deliver on its promises, but he acknowledges the need for broader government support. He urged leaders to prioritize rare earths as a strategic resource, not just a commodity. The next two years will be critical for testing whether alternatives can truly break China’s grip.
