Global supply chains for rare earth minerals are under serious threat due to China’s growing control over mining and refining, Goldman Sachs has warned. These minerals are essential for modern technologies from smartphones and electric cars to missiles and artificial intelligence and any disruption could cause major economic damage worldwide.
China recently tightened export rules on rare earth elements, adding five more minerals to its restricted list. This move comes ahead of a possible summit between US leader Donald Trump and Chinese President Xi Jinping. Goldman Sachs reports that China currently controls 69% of global rare earth mining, 92% of refining, and nearly 98% of magnet production giving it enormous power over global industries.
The bank highlighted that minerals such as samarium, graphite, lutetium, and terbium are especially at risk of export bans. Samarium is essential for heat-resistant magnets used in defence and aerospace, while shortages of lutetium and terbium could lead to GDP losses in several countries.
Goldman Sachs also warned that even a 10% disruption in rare earth supply could cause $150 billion in global economic losses and increase inflation. Although countries like the US, Japan, and Germany are trying to build independent supply chains, they face major hurdles scarce resources, long mining timelines (8–10 years), refining challenges, and environmental concerns.
Companies such as Lynas Rare Earths and Solvay may help reduce dependence on China, but global reliance remains high. The bank also pointed to future risks in other commodities like cobalt, oil, and natural gas due to rising geopolitical tensions.
Why It Matters to People:
This issue isn’t just about minerals it’s about everyday life. Rare earth shortages could slow technology production, raise prices of smartphones, electric cars, and even national defence systems. In short, a few minerals deep underground now have the power to shake the world’s economy and affect ordinary people.
