SPECIAL REPORT: U.S. Begins Forging Rare Earth Supply Chain
MP Materials photo
This is part 4 of a 5-part special report on the health of the defense industrial base. Click here to download the full Vital Signs 2023 report.
MOUNTAIN PASS, California — From the smartphone in your pocket to magnets powering a growing number of electric vehicles on the road, rare earth elements are the foundational components for some of the most commonly used technologies today.
But over the last three decades, Beijing has held an iron grip on the world’s supply chain for rare earth elements such that nearly all materials — no matter where in the world they are mined — travel to China for refinement before they can be used in technologies.
Currently, the country controls nearly 60 percent of rare earth mining operations, more than 85 percent of processing capacity and more than 90 percent of permanent magnet production, according to the U.S. Department of Commerce.
It’s an issue that poses a vulnerability within the United States’ supply chain and poses potential national security risks, considering Washington’s strained relations with Beijing. As demand signals for technologies that rely on these elements are projected to skyrocket, both industry and government are investing in methods that aim to secure a domestic rare earth supply chain.
Despite being labeled as “rare,” the 17 different elements known as rare earths are relatively abundant in the Earth’s crust. The Biden administration considers them one of the strategic and critical materials and minerals for their use in several modern commercial and defense technologies — including smartphones, medical equipment and highly specialized magnets used in electric vehicles, jet fighters and drones.
But since the chemical properties of rare earth elements are nearly indistinguishable from one another, individually separating and refining them so they can be used to make magnets and other technologies is a complex process, said Linda Chrisey, program manager at the Defense Advanced Research Projects Agency.
“Two different rare earth elements may be fractions of an angstrom different in diameter — that means it’s very difficult to separate using physical means. The processes that are used right now … can be 100 steps,” Chrisey said, also noting that the procedure can be very expensive and environmentally hazardous due to the chemicals used to separate and purify the metals.
“These are all reasons why it has been difficult to sustain that kind of operation in the United States,” she added.
However, on top of a mountain in the Mojave Desert at the United States’ largest rare earth mine, MP Materials is trying to reverse that trend.
With the scale and capability of their facilities, MP Materials is trying to become a “magnet champion” in the Western Hemisphere, said Matt Sloustcher, MP Materials’ senior vice president of communications and policy.
“What we’re trying to do is build a full magnetic supply chain, and we want to be able to make all the necessary materials and recycle the necessary materials to have that magnetic supply chain,” he said.
Since acquiring the Mountain Pass mine in 2017, MP Materials has revitalized the site’s production of rare earth elements and produces a mixture of rare earth concentrate that contributes around 15 percent of the rare earth minerals consumed each year, according to the United States Geological Survey.
And soon, MP Materials will no longer have to ship this mixture overseas to China for the lengthy process of separating and refining the rare earth elements. After two years of construction, the company announced in November that it is on the cusp of opening the first rare earth refinement facility within the United States at the Mountain Pass facility.
First it must commission assets for the new facility for the second stage of production, which is a process of stress testing the facility’s equipment to ensure it is performing at the rate it was designed for, Sloustcher said during a tour of the ongoing construction at the Mountain Pass mine. The procedure will unfold over the course of 2023, he added.
“We’re months away from producing refined products,” he said. “It’s really exciting.”
The second stage of production starts with a process of drying, roasting, leaching and purifying the mixture of rare earth concentrate, he explained. Then, the rare earths are fed into one of several towering tanks located in a building longer than an American football field. In these vats, a solvent extraction process separates the mixture into individual rare earth oxides, he said.
Although it’s just one refinement facility competing against multiple in China, its opening marks a crucial step in the United States’ effort to address its vulnerable rare earth supply chain. In 2020, the Department of Defense invested $10 million into the $200 million project, according to a Pentagon press release.
MP Materials will focus on refining a compound of neodymium and praseodymium — one of the most common materials used to make rare earth magnets — as well as lanthanum and cerium, Sloustcher noted. These elements are classified as “light rare earths.”
The government is also pushing for domestic production of “heavy rare earths,” which are more difficult to refine but also used to make more specialized magnets. For example, heavy rare earths terbium and dysprosium are needed to make rare earth permanent magnets that can operate in high temperatures, while samarium is used to produce samarium-cobalt magnets found in aerospace and defense applications.
“If you don’t have separated rare earths domestically, there’s a point of failure in the supply chain for magnets,” he said.
The Defense Department awarded MP Materials a $35 million contract in February 2022 to build a facility specifically designed to process heavy rare earth elements at the Mountain Pass mine. Sloustcher said the heavy rare earths will be refined in a different building, adding that the project is just getting started.
To fully domesticate the magnet supply chain, MP Materials also began construction on the United States’ first rare earth magnetics factory in April 2022. Located in Fort Worth, Texas, the facility will be able to annually produce around 1,000 tons of neodymium-iron-boron magnets from rare earth elements mined and refined at the Mountain Pass facilities, according to the company.
Because the defense market accounts for just a fraction of the United States’ total demand for rare earths — around five percent — the company is looking to address needs within the commercial industry first, Sloustcher noted.
Demand signals for rare earths are projected to rise as the world electrifies with machines that require highly specialized rare earth magnets.
According to a report by independent research firm Adamas Intelligence, the global demand for rare earth oxides is forecasted to triple from $15 billion in 2022 to $46 billion in 2035.
“The world is electrifying on every front possible — electric vehicles, wind turbines, drones, robots, everything,” Sloustcher said. “So the demand picture is very bright, and the supply just isn’t there relative to what most analysts project demand will produce.”
MP Materials has already entered an agreement with General Motors to produce rare earth alloys and magnets for the automobile manufacturer’s electric vehicle programs beginning in late 2023, he said.
“Defense demand alone can’t even stand up a modestly sized magnetics facility,” Sloustcher said. “We want to be able to stand up and be able to supply GM and other companies … and if we succeed in doing that, defense demand can be satiated.”
Meanwhile, Chrisey and her team at DARPA are researching ways to secure a domestic rare earth supply chain using a different kind of method — biomining.
The Environmental Microbes as a BioEngineering Resource, or EMBER, program is a DARPA initiative to use microbial and biomolecular engineering techniques to separate and purify rare earth mixtures like the ones produced at the Mountain Pass mine, Chrisey said. The program was inspired by microbes found living in harsh, volcanic environments that were using rare earth elements in order to survive, she said.
“Because they were exposed to these extreme environments, they were using the rare earths as cofactors for enzymes and they’ve evolved transport systems to pick the elements up from the environment and bring them into the cell and store them until they were needed,” she explained. “Maybe we can figure out how the cells are doing this and exploit that for our purposes.”
EMBER will use biomining to mimic this naturally occurring phenomenon. The technique uses microbes to help break down or separate an element of interest from a larger mixture, Chrisey explained. The process isn’t fully developed for rare earths due to “poor specificity and selectivity of the microbes” for the elements, the agency said.
In October, the program announced it had selected teams from the Lawrence Livermore National Laboratory, the Battelle Memorial Institute and San Diego State University to participate in phase one of the four-year program.
Each team will take a different source material that contains at least eight different rare earth elements, separating and refining each element from one another using different microbes and biomining techniques, Chrisey said. The three groups are using a unique combination of source material, microbe and biomining, she added.
For example, two teams are starting with mineral sources that can be partially processed from ore dug out from the ground, while the third is looking at mined waste. And while one group is focusing on microbes because they are naturally found in extreme environments, another team is using a class of microbes that grow on methane and feed on greenhouse gas.
“We’re thinking about many different levels and how biology could give an advantage in this overall process,” she said.
Phase one of EMBER is expected to wrap up around January 2024, after which DARPA will make a decision whether or not to continue with the second phase, Chrisey said. If it does, the next phase will focus on improving the efficiency and scale of separating rare earths from source rocks, and then phase three will end in a pilot-scale rare earth biomining demonstration.
Part 1: Annual Survey Shows Growing Worry Over Health of Industrial Base
Part 2: Defense Companies Face Post-Pandemic Workforce Shortages
Part 3: How Immigration Reforms Can Help Counter China
Part 5: Pentagon Makes Moves to Speed Up Tech Transition - to come