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Current heavy rare earths production outside China falls short of magnet demand: REA CEO - Fastmarkets

September 8, 2026AIC Engineering

Explore the rising demand for rare earths in the magnet industry and their crucial role in future production.

Republished by AIC Engineering. All rights belong to the original publisher; see Source below.

Magnet capacity expansion drives heavy rare earth demand

Between 20,000-30,000 tonnes of magnet capacity is coming online outside of China, according to Swartz. As more capacity comes online between 2030 and 2035, magnet companies need stable access to rare earths supply to produce.

The growing magnet industry will drive up demand specifically for heavy rare earths like dysprosium and terbium. “In essence, there are 0 heavies being produced and separated in the Western world,” Swartz said.

Magnet producers will need roughly 2,500 tonnes of heavy rare earths to support the growing industry in the next 10 years. Rare earths company Meteoric, which operates the Caldeira project adjacent to REA’s Constellation project in Minas Gerais, Brazil, will eventually produce 100-200 tonnes of heavy rare earths, Swartz said. But “[you] need to have probably 10 western projects of similar capability to [Meteoric’s project] to kind of get built over this…the next decade,” Swartz said.

“There really have not been a lot of projects that have heavy rare earths in them,” he added.

While there are many proposed projects and developments outside of China for heavy rare earths, “it’s just going to take some time for these projects to move through the pipelines, to be permitted, to be designed, to get the offtakes done and kind of come online in the course of the next five years,” according to Swartz.

Government support boosts investor confidence

But “the [US] government intervention in the space has been a tailwind” for rare earths, Swartz said.

Financing for rare earths projects was difficult to source, according to Swartz, since heavy rare earths pricing was tied to Chinese prices. Now, “these evolutions of price floors and government deals have allowed investors to have more confidence in the space,” Swartz told Fastmarkets.

The US Department of Defense (DOD) announced a USD 725 million loan to Energy Fuels to support a rare earths separation and metallization facility in the US in June.

Phoenix Tailings also received a USD 500 million DOD loan in June to build its own separation facility.

And the DOD invested another USD 25 million into ReElement Technologies to boost refining capacity at the company’s rare earths plant in Indiana in July.

Myanmar remains critical to global heavy rare earth supply

Still, “probably over [90-93%] of the heavies are coming from Myanmar,” Swartz said.

“China exhausted, to a large degree, their heavy assemblage in their ionic clay deposits in Southeast China and jumped across the border,” according to Swartz. Myanmar produced 27,000 tonnes of rare earths in 2024 and exported the entire amount to China, according to the US Geological Survey (USGS).

But REA believes its developments in Brazil and the US are key to developing an independent heavy rare earths supply chain.

“If you think about that geology, weathering profile, climate, [REA’s projects in Brazil are] very similar to the historic ionic clay mining that was done in China,” Swartz said. “It’s going to take a little bit of time, but Brazil is sort of what I would call the epicenter of the ex-China rare earth downstream.”

REA has three projects in Brazil: Constellation in Minas Gerais, Alpha in Bahia, and Homer in Goiás.

REA also operates the 400,000 acre Foothills deposit near Shiloh, Georgia. The company is exploring a monazite deposit, which can produce heavy rare earths.

REA’s production timeline for its projects “fit in pretty well with the development timeline of the magnetic build out [around] 2030 and beyond,” Swartz said.

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