Electric car motors, iPhones, military jet engines, batteries, and satellites all have something in common: They require rare-earth elements to function.
Rare-earth elements are a group of 17 metals that — as their name suggests — form under the Earth’s surface and are difficult to find and extract.
But they are crucial to the tech and defense industries; rare-earth metals have unique magnetic, heat-resistant, and phosphorescent properties that no other elements have. This means that they’re often non-substitutable materials in smartphone and missile production.
China controls the lion’s share of mineable rare-earth deposits. On average, the country has accounted for more than 90% of the global production and supply of these metals during the past decade, according to the US Geological Survey (USGS). Mining and refining these materials isn’t easy, and very few countries can compete with China’s monopoly on the rare-earth market. According to Bloomberg, the US relies on China for 80% of its rare-earth imports.
That puts China in a powerful position: If its leaders choose to restrict rare-earth exports to the US — something president Xi Jinping recently hinted could happen — that could temporarily cripple companies like Apple and Lockheed Martin.
Even the US Department of Defense (DoD) relies on rare-earth elements for manufacturing. And the US Department of the Interior listed the minerals as “critical” to the country’s economic and national security.
Here are 16 facts about how these highly-coveted materials are mined and refined, and why a possible trade restriction could hurt US tech and defense companies.