The February release of the US Geological Survey’s – USGS Mineral Commodity Summary for 2026 provides the latest overview of global rare earth resources. Global rare earth reserves totalled around 85 million metric tonnes at the end of 2025, with China placed first with 44 million metric tonnes, or about 51.7% of the total. Brazil came next with 21 million metric tonnes, followed by Australia, Russia, and Vietnam as well as the United States. This annual data not just confirms the absolute dominance of China in the rare earth sector but also demonstrates the logic behind the US, Europe rare earths supply chain restructuring.
In terms of rare earth production, China is not just the largest holder of rare earth reserves in the world but also the dominant production leader. In 2025, China produced round about 270,000 metric tonnes of rare earths, or 69.2% of the total production of 390,000 metric tonnes in the world. Meanwhile, China has about 90% of the world’s rare earth refining and processing capability. Its dual dominance when it comes to mining and smelting gives it a distinctive strategic deterrent power as far as US, Europe rare earths supply chain is concerned.
On the policy front, China continues to tighten export controls while staying ahead on the resource aspect. Apparently, China expanded its control list to include limitations on five rare earth elements, which were holmium, erbium, thulium, and europium as well as ytterbium, in October 2025. The U.S.-China trade ceasefire is set for termination in November 2026. If the truce is not prolonged, China’s list of controlled exports could grow to 12 items.
The Chasers – Disparity between Production Capacity and Reserves
It is well to be noted that Brazil has the second-largest reserves in the world, at 21 million metric tonnes, but produced roughly 2,000 metric tonnes in 2025 and has huge undeveloped resources. Change is on the way, as in April, USA Rare Earth announced the acquisition of Serra Verde of Brazil for $2.8 billion, which will give it the Pela Ema rare earth mine and sole off-take rights for 15 years. Once Phase 1 is fully operational in 2027, the project is projected to produce 6,400 metric tonnes of rare earth oxides annually.
Australia’s reserves are around 5.7 million metric tonnes, which is the USGS figure, but its production has already hit 29,000 metric tonnes, with more efficient conversion capacity compared to Brazil.
Lynas, the world’s biggest producer of rare earths outside of China, reported a 32% year-over-year increase in NdPr output in the third quarter of fiscal 2026 and in March achieved its first commercial production when it comes to samarium oxide. Australia is shoring up its strategic standing as a major rare earth supplier to Western partners, and its resources minister has declared that a strategic reserve policy will be pursued, which certainly includes price support modalities.
The U.S. has roughly 1.9 million metric tonnes in reserves, but it is the second-largest producer in the world, producing 51,000 metric tonnes in 2025, up 12% from the year before. MP Materials, the leading domestic player, said it produced an unprecedented 917 metric tonnes of NdPr in the Q1 of 2026, up 63% from a year earlier. The company has built a heavy rare earth separation plant and expects it to be operational and start producing dysprosium, terbium and other critical heavy rare earths by the middle of 2026. The Pentagon has also invested $400 million in MP, while USA Rare Earth got a letter of interest for $1.6 billion in monetary support from the Department of Commerce. But US rare earth imports soared 169% in 2025, and net import dependence increased to 67% from 53%, suggesting it will require time to develop a domestic supply chain from mine to magnet.
Russia, at 3.8 million metric tonnes of reserves; Vietnam, at 3.5 million metric tonnes; and Greenland, at 1.5 million metric tonnes, are also noteworthy. In 2026, Russia enacted a new law imposing stricter criteria for foreign investment into its rare earth sector as part of an effort to capitalise on its resources as geopolitical tools. At the same time, Vietnam amended its Geology and Mineral Law, significantly broadening state control over rare earths and prohibiting the export of raw rare earth ore. The Kvanefjeld project from Greenland has hit a snag due to disagreements over its uranium content, and the exploration licence renewal was denied in April 2026, putting a strategic project with more than 11 million metric tonnes of reserves on standby.
Structural Contradictions and Implications for Strategy
The world’s rare earth supply faces a dual imbalance. First, there is a gap between reserves and production – countries such as Brazil and Vietnam have huge resources but restricted capacity, while the US and Australia have much higher capacity utilisation rates. Second, there is an inconsistency between resources and processing capacity. Although the raw material sources are growing more diversified, rare earth refining and processing are still extremely concentrated in China. Europe depends on China for 98-99% of its rare earths, a structural dependence that is not likely to change significantly in the short term.
Interestingly, the geopolitical variables contribute to an already turbulent landscape. The US buying spree in Brazil, capacity growth by Lynas and MP, Russia closing off foreign access and the political impasse over the Greenland project are all pointing to one trend, and that’s rare earths are changing from a commodity into a critical negotiation chip in great power rivalry. China’s resource fund, full industrial chain and technological lead have created a castle that is tough to copy. But for the global supply chain, the transition from excessive concentration to mild diversification will be an unchanging strategic necessity in the decade to come.
