Rebuilding the American Industrial Base, Rare Earths Edition || Peter Zeihan

• The recent US-China trade talks struggle because the US lacks expert staff and clear strategies.
• Trump administration's small and siloed trade team hampers effective negotiation against China.

China controls nearly the entire rare earths supply chain, from mining to manufacturing advanced components like magnets essential for electronics and automotive parts.

These rare earths aren't actually rare but hard to mine and process due to extremely low concentrations, requiring hundreds of chemical separation steps.

In the 1980s, the U.S. and Europe produced most rare earths but lost out as China aggressively undercut prices by ignoring environmental standards and heavily subsidizing production.

Today, China refuses to export the finished rare earth magnets, leveraging its dominance to pressure U.S. manufacturers and disrupt supply chains.

This has exposed critical vulnerabilities in U.S. trade and manufacturing policies, highlighting the urgent need to rebuild domestic processing and manufacturing infrastructure for rare earths to reduce dependency on China.

• Rare earths are not actually rare but hard to source because they don't occur in high concentrations.
• Extraction involves multiple chemical steps and takes six to eight months from several tons of material.