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China controlled 69% of rare earth mine production in 2024, and nearly half of the world’s reserves.
There are barely any alternatives to China for obtaining the rare earths.
“You cannot build a modern car without rare earths,” an analyst said.

Annealed neodymium iron boron magnets sit in a barrel prior to being crushed into powder at Neo Material Technologies Inc.’s Magnequench Tianjin Co. factory in Tianjin, China.
Bloomberg | Bloomberg | Getty Images

BEIJING — As China tightens its grip on the global supply of key minerals, the West is working to reduce its dependence on Chinese rare earth.
This includes finding alternative sources of rare earth minerals, developing technologies to reduce reliance, and recovering existing stockpiles through recycling products that are reaching the end of their shelf life.

“You cannot build a modern car without rare earths,” said consulting firm AlixPartners, noting how Chinese companies have come to dominate the supply chain for the minerals.
In September 2024, the U.S. Department of Defense invested $4.2 million in Rare Earth Salts, a startup that aims to extract the oxides from domestic recycled products such as fluorescent light bulbs. Japan’s Toyota has also been investing in technologies to reduce the use of rare earth elements.
According to the U.S. Geological Survey, China controlled 69% of rare earth mine production in 2024, and nearly half of the world’s reserves.
Analysts from AlixPartners estimate that a typical single-motor battery electric vehicle includes around 550 grams (1.21 pounds) of components containing rare earths, unlike gasoline-powered cars, which only use 140 grams of rare earths, or about 5 ounces.

Pretty soon, the first generation of EVs will be up for recycling themselves, creating a pool of ex-China material that will be under the control of the West.

Christopher Ecclestone
Principal and mining strategist at Hallgarten & Company

More than half of the new passenger cars sold in China are battery-only and hybrid-powered cars, unlike the U.S., where they are still mostly gasoline-powered.

“With slowing EV uptake (in the U.S.) and mandates to convert from ICE to EV formats receding into the future, the imperative for replacing Chinese-sourced materials in EVs is declining,” said Christopher Ecclestone, principal and mining strategist at Hallgarten & Company.
“Pretty soon, the first generation of EVs will be up for recycling themselves, creating a pool of ex-China material that will be under the control of the West,” he said.

Only 7.5% of new U.S. vehicle sales in the first quarter were electric, a modest increase from a year ago, according to Cox Automotive. It pointed out that around two-thirds of EVs sold in the U.S. last year were assembled locally, but manufacturers still rely on imports for the parts.
“The current, full-blown trade war with China, the world’s leading supplier of EV battery materials, will distort the market even more.”

Rare torque

Of the 1.7 kilograms (3.74 pounds) of components containing rare earths found in a typical single-motor battery electric car, 550 grams (1.2 pounds) are rare earths. About the same amount, 510 grams, is used in hybrid-powered vehicles using lithium-ion batteries.

In early April, China announced export controls on seven rare earths. Those restrictions included terbium, 9 grams of which is typically used in a single-motor EV, AlixPartners data showed.
None of the six other targeted rare earths are significantly used in cars, according to the data. But April’s list is not the only one. A separate Chinese list of metal controls that took effect in December restricts exports of cerium, 50 grams of which AlixPartners said is used on average in a single-motor EV.
The controls mean that Chinese companies handling the minerals must get government approval to sell them overseas. Caixin, a Chinese business news outlet, reported on May 15, just days after a U.S.-China trade truce, that three leading Chinese rare earth magnet companies have received export licenses from the commerce ministry to ship to North America and Europe.
What’s concerning for international business is that there are barely any alternatives to China for obtaining the rare earths. Mines can take years to get operating approval, while processing plants also take time and expertise to establish.
“Today, China controls over 90% of the global refined supply for the four magnet rare earth elements (Nd, Pr, Dy, Tb), which are used to make permanent magnets for EV motors,” the International Energy Agency said in a statement. That refers to neodymium, praseodymium, dysprosium and terbium.

For the less commonly used nickel metal hydride batteries in hybrid cars, the amount of rare earths goes up to 4.45 kilograms, or nearly 10 pounds, according to AlixPartners. That’s largely because that kind of battery uses 3.5 kilograms of lanthanum.
“I estimate that around 70% of the over 200 kilograms of minerals in an EV goes through China, but it varies by vehicle and manufacturer. It’s hard to put a definitive figure on it,” said Henry Sanderson, associate fellow at The Royal United Services Institute for Defence and Security.

Power projection

However, there are limits to recycling, which remains challenging, energy-intensive and time-consuming. And even if adoption of EVs in the U.S. slows, the minerals are used in far larger quantities in defense.
For example, the F-35 fighter jet contains over 900 pounds of rare earths, according to the Center for Strategic and International Studies, based in Washington, D.C.
China’s rare earths restrictions also go beyond the closely watched list released on April 4.

Large rocks containing chromite, is crushed into smaller bitesize chunks, before to goes through a process to refine and extract the ore that yields chromium, a vital component of stainless steel, at the Mughulkhil mine in Logar Province, Afghanistan.
Marcus Yam | Los Angeles Times | Getty Images

In the last two years, China has increased its control over a broader category of metals known as critical minerals. In the summer of 2023, China said it would restrict exports of gallium and germanium, both used in chipmaking. About a year later, it announced restrictions on antimony, used to strengthen other metals and a significant component in bullets, nuclear weapons production and lead-acid batteries.
The State Council, the country’s top executive body, in October released an entire policy for strengthening controls of exports, including minerals, that might have dual-use properties, or be used for military and civilian purposes.

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One restriction that caught many in the industry by surprise was on tungsten, a U.S.-designated critical mineral but not a rare earth. The extremely hard metal is used in weapons, cutting tools, semiconductors and car batteries.
China produced about 80% of the global tungsten supply in 2024, and the U.S. imports 27% of tungsten from China, data from the U.S. Geological Survey showed.
About 2 kilograms of tungsten is typically used in each electric car battery, said Michael Dornhofer, founder of metals consulting firm Independent Supply Business Partner. He pointed out that this tungsten is not able to return to the recycling chain for at least seven years, and its low levels of use might not even make it reusable.
“50% of the world’s tungsten is consumed by China, so they have business as usual,” Lewis Black, CEO of tungsten mining company Almonty, said in an interview last month. “It’s the other 40% that’s produced (in China) that comes into the West that doesn’t exist.”
He said when the company’s forthcoming tungsten mine in South Korea reopens this year, it would mean there would be enough non-China supply of the metal to satisfy U.S., Europe and South Korean needs for defense.
But for autos, medical and aerospace, “we just don’t have enough.” Continue reading →

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While gold prices surged to a new all-time high of USD 3,500 on April 22nd following a spectacular rally, silver continues to trade significantly below its strong resistance zone around USD 35. Despite gold’s bullish momentum, silver has yet to revisit its October peak of USD 34.89. Silver Chartbook – Poised For A Breakout.

Instead, silver prices have been cunningly moving in a deceptive sideways consolidating, trading primarily between USD 32 and USD 33, since mid-April. Beforehand, the silver market witnessed a sharp V-shaped recovery from a brief crash in early April, when prices dropped from USD 34.58 to USD 28.31 before rebounding to USD 33.69.

Silver Appears Extremely Undervalued

With a gold/silver ratio just below 100, silver lags far behind gold. The long-term average gold/silver ratio since 1970 is approximately 55:1, meaning it has historically taken about 55 ounces of silver to purchase one ounce of gold, though it has fluctuated widely from 15:1 in silver’s favor (e.g., 1980) to over 100:1 during weaker periods (e.g., early 2020s). With the current ratio near 100:1 as of May 21st, 2025, silver is significantly undervalued – arguably dirt cheap – relative to its historical norm. This disparity suggests a compelling opportunity for silver to potentially outperform gold if the ratio reverts toward its long-term mean.

Nevertheless, silver has nearly doubled in value over the past two and a half years. Still, many silver investors are disappointed, impatiently awaiting the spectacular surges seen in past bull markets, such as in 2011 and 1980. Interestingly, though, over the past five years since the 2020 COVID crash, silver has significantly outperformed gold.

Silver Supply and Demand

Fundamentally, according to our colleagues at the In Gold We Trust Report 2025, a fifth consecutive supply deficit of -117.6 million ounces is projected for 2025. Cumulatively, this amounts to a staggering deficit of nearly 800 million ounces between 2021 and 2025, equivalent to an entire year’s global silver mine production!

Silver Supply and Demand 2016–2025, as of May 12, 2025. Source: The Silver Institute

Silver demand is primarily driven by industrial use, particularly in photovoltaics, which hit a record high of 197.6 million ounces in 2024. The outlook for silver remains promising, bolstered by innovations like Samsung’s silver-based solid-state batteries, which promise to double energy density.

Gold Price Action Remains The Most Critical Factor For Now

Ultimately, however, gold price action remains the most critical factor for silver’s immediate price trajectory. The expected breakout above USD 35 for silver depends heavily on gold market stabilization, which is currently experiencing a volatile consolidation between USD 3,120 and USD 3,400ish. Should the gold/silver ratio revert to its historical average since 1970, silver could easily climb to USD 50, assuming a current gold price of approximately USD 3,300.

Silver in US-Dollar, Daily chart

Silver in US-Dollar, weekly chart as of May 21st, 2025. Source: Tradingview

Since April 23rd, silver has been consolidating its sharp recovery, which followed a brief crash amid collapsing stock markets in early April. At that time, silver plummeted from USD 34.58 to USD 28.31 within days, only to rebound sharply in a V-shaped recovery to USD 33.69.

The sideways consolidation since then appeared erratic and deceptive, but retained a clearly underlying bullish tone. Following a robust upward surge last Tuesday, May 20th, 2025, silver appears to be breaking out of its sideways consolidation, which has formed a flag pattern. Although silver might briefly retest its rising 200-day moving average at USD 31.39 for support, the trajectory now points toward higher resistance levels. Additionally, at USD 31.89, the lower Bollinger Band and the steadfast uptrend line from February 2024 offer further support, reinforcing the bullish outlook.

Gold closed its open gap at around USD 3,320ish

For silver to continue breaking out of its flag consolidation pattern, it will need support from the gold price. The gold market, however, is currently in a volatile correction phase, marked by a sharp sell-off from USD 3,435 to USD 3,120, followed by a strong recovery to USD 3,320. The open gap at USD 3,320 has been closed as of this morning. However, our roadmap of volatile consolidation at high levels is holding true so far. But this wild, volatile back-and-forth in the gold market is not for the faint of heart and can always drag down silver as well. We suspect this volatile consolidation could persist for a while before the gold market calms down a little bit and the next upward trend phase begins.

Therefore, silver investors will need to remain patient accordingly. Nevertheless, we view the downside risk for silver as very manageable. The medium-term opportunity remains a potential rise to USD 50, at least. Until this breakout begins, silver investors should brace for a few more deceptive maneuvers within or above the flag pattern, as silver loves nothing more than to keep everyone guessing.

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Conclusion: Silver – Poised For A Breakout

While gold soared from one all-time high to the next through mid-April, silver has notably lagged behind expectations. Our optimistic forecast of a rise to approximately USD 50 has yet to materialize, but remains highly plausible.

Since mid-April, silver has traded within a narrow sideways range, predominantly between USD 32 and USD 33, despite nearly doubling in value over the past two and a half years – a performance that has left many investors frustrated by the absence of the dramatic surges seen in previous bull cycles. We believe a breakout above USD 35 is just a matter of time.

Unveiling Silver’s Bullish Potential Amid Supply Constraints

Fundamentally, silver’s persistent supply deficit underscores its clear undervaluation, while technically, it is consolidating its swift recovery from the early April dip. Though the current sideways trend appears erratic, it retains a bullish outlook, hinting at an approaching breakout. An upward surge past USD 35 should unleash significant bullish momentum, potentially propelling silver swiftly toward USD 50, with strong medium-term prospects for substantial price gains. Continue reading →

Gold bumped up 1% on Friday, heads for the best week in six as U.S. fiscal concerns mounted after Moody’s … Continue reading →