SYDNEY, July 7 — Australia holds the world’s sixth-largest rare earth reserves, estimated at 4.1 million metric tons, a position that has drawn increasing attention as global supply chains for these critical minerals remain heavily concentrated in China. The Mount Weld deposit in Western Australia, operated by Lynas Rare Earths, stands as the country’s most significant rare earth operation. Lynas is the largest non-Chinese producer of these minerals, a distinction that has made it a focal point for Western governments seeking to diversify their sources of supply.
The company runs a plant in Malaysia that produced 16,000 metric tons of rare earth oxides in 2023. That facility has faced its own regulatory and political challenges over the years, but it remains a rare example of rare earth processing outside China.
Strategic contracts and US interest
In 2022, the U.S. Department of Defense awarded Lynas a $120 million contract to build a processing facility in Texas. The contract reflected Washington’s concern about reliance on Chinese rare earths, which are used in everything from electric vehicle motors to military guidance systems. The Texas plant would represent a significant step toward building a domestic rare earth supply chain in the United States.
Lynas has not disclosed a completion date for that facility, though the contract itself signalled the strategic importance the Pentagon attaches to these materials. Greenland holds significant rare earth deposits, including the Kvanefjeld project, which has been estimated to contain 10.1 million metric tons of rare earth oxides.
That project’s viability, however, was thrown into doubt when Greenland’s government banned uranium mining in 2021. Rare earth deposits often contain uranium and thorium as byproducts, meaning such bans can render entire projects uneconomical.
Other projects and the broader picture
Other notable rare earth projects include the Steenkampskraal mine in South Africa and the Nechalacho deposit in Canada. Both have attracted investment and interest, though neither has reached the scale of Mount Weld or the Lynas processing operation. The challenge for any new rare earth project is not merely extracting the ore.
The processing stage, which separates the individual rare earth elements from the mined material, is technically complex and environmentally sensitive. China has dominated this stage for decades, building expertise and infrastructure that competitors have struggled to match.
For Australia, the Mount Weld deposit and Lynas’s existing processing capacity provide a foundation. The question is whether that foundation can be expanded quickly enough to meet demand from Western manufacturers and governments seeking alternatives to Chinese supply. The coming years will show whether the strategic interest from Washington translates into sustained investment in processing capacity outside China.
For now, Lynas remains the largest non-Chinese producer, and its operations in Western Australia, Malaysia, and soon Texas will be watched closely by governments and markets alike.
