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Virtual Rare Earth Conference - Master Class on Investing in Rare Earth Sector

Jimmy Connor Jul 11, 2026 1:38:29

Summary

China controls 60% of mining, 91% of refining, and 94% of magnet output, pushing Western governments to fund non-Chinese rare earth supply.

Dysprosium is up 300% and terbium is up 400% on Chinese export restrictions, with Western buyers still struggling to secure heavy rare earths.

Heavy rare earths are hardest to extract economically; China refines roughly 98% of heavy metal, the gap G7 nations are racing to close.

Rainbow Rare Earths targets 2029 production by recovering rare earths from phosphate mining waste stockpiles, sidestepping traditional mining risk.

Humanoid robots could use 3 to 5 times more permanent magnets per unit than an EV, opening a major new rare earth demand vector.

Jimmy Connor's takeaways

  • Top takeaway Jimmy frames the conference as a deep dive into investing in rare earths, prompted by China's 'weaponization' via export restrictions and the recent price moves: neodymium up 75%, dysprosium up 300%, terbium up 400%.
  • He flags humanoid robots as the new structural demand layer, citing Musk's projection of up to 10 billion humanoids by 2040 and noting a single humanoid uses 3-5x the permanent magnets of an EV.

Steve Schoffstall's takeaways

  • Top takeaway Steve argues that China now controls about 69% of rare earth mining and over 90% of refining and magnet production, and that Western countries are putting unprecedented funding and policy in place to reshore production away from Chinese control.
  • He points to dysprosium's move from $100/kg to $900/kg as direct evidence that Chinese export controls are tightening supply and lifting prices.
  • He pitches Sprott's new REXC ETF as the only fund solely focused on rare earths, with ~96% pure-play exposure versus single-digit exposure in many competing products marketed under the rare earth label.
  • He stresses that the investment case is multi-year: rare earth prices have 'gone through the roof', Western reshoring programs are real, and the ETF's ~48% Australia / ~40% US / ~8% Canada weighting captures the geography of that build-out.

Meredith Schwartz's takeaways

  • Top takeaway Meredith argues China has 'weaponized' rare earths through a long-running strategy of first oversupplying to crash prices and drive Western competitors out of the market, then restricting supply once dominant.
  • She notes the Trump-Xi one-year moratorium on Chinese export restrictions has been largely ineffective: the New York Times reported the US has not successfully imported any dysprosium or terbium from China since the restrictions began, and yttrium exports remain low even with the moratorium in place.
  • She highlights the G7's first-ever pledge that no single nation may supply more than 60% of rare earth imports by 2030, alongside a separate US deadline of 2027 for the defense industry to source rare earths outside China.
  • She describes a whole-of-government US response covering Interior and Energy on domestic permitting and innovation funding, the DFC and EXIM Bank on international project finance (including rare earths in Brazil and over $2.2B into Australian critical minerals), and the Department of War's Office of Strategic Capital investing in a Saudi Arabian refining facility.
  • She uses Japan's 15-year response to the 2010 South China Sea dispute (recycling, seabed mining, the Lynas relationship) as the playbook, while noting Japan still imports about 60% of its rare earths from China.

George Bennett's takeaways

  • Top takeaway George argues Rainbow's economics are 'unsurpassed' in mining because the rare earths come out of existing phosphate gypsum waste via chemical processing: Phalaborwa NPV about $775M, ~$220M/year EBITDA, ~75% EBITDA margin and a post-tax IRR above 44% at $300-325M capex with a 16-year stockpile life, no mining or geological risk.
  • He positions Rainbow as a two-asset story: Phalaborwa in South Africa (35Mt stockpile, production targeted 2029 after DFS end-2026 and FID end-Q3 2027) and Uberaba in Brazil (Mosaic 51/49 JV, 30+ year stockpile, production targeted 2030).
  • He highlights the US DFC's $50M project equity commitment to Phalaborwa at FID, alongside ~$200M of debt and only ~$50M of remaining equity, and notes the DFC has signaled interest in extending support to the Brazil project.
  • He flags a March 2025 raise of $14.6M led 90%+ by US investors with Traxxas (a partner in the US government's $12B Project Vault) as a cornerstone, plus an ongoing evaluation of a US listing to drive a re-rating and improved liquidity.
  • He ties demand to EVs, wind turbines, humanoid robots (3-5x the permanent magnets of an EV) and eVTOLs/drones, with dysprosium prices moving from $100/kg to $1,200/kg, and flags near-term news flow on pilot optimizations, the Uberaba pre-feasibility kickoff, off-take agreements and final DFS numbers.

Sam Riggall's takeaways

  • Top takeaway Sam argues Sunrise's Syerston project will be the world's first primary scandium mine, with ore grades of about 650 ppm scandium versus 10-20 ppm in Chinese scandium currently recovered as a by-product from waste streams.
  • He frames scandium demand as structurally tight and largely non-substitutable: one chipmaker told him the only 'plan B' if China cuts scandium supply is going back to 3G, and he cites solid oxide fuel cells (a NASA-origin technology used by Bloom Energy), defense alloys (drones, the F-35 program), and 5G/6G RF filtering chips as the key growth markets.
  • He sizes the market at around 100 tonnes of scandium oxide demand today (versus USGS figures of 40-50 tonnes) and forecasts ~300 tonnes/year by 2030 and 500-600 tonnes/year by 2035, with the chip-grade metal market around 5 tonnes globally.
  • The 2024/2025 feasibility study calls for roughly $120M capex for a 60-tonne/year scandium oxide mine-and-refinery, a C1 cash cost around $540/kg of oxide, and first commercial production in mid-2028, with construction already underway and long-lead equipment orders being placed.
  • He expects funding announcements from North American government programs in the coming months and is exploring US metallization capacity so the chip supply chain can be supplied with metalized scandium without going through China.

Constantine Karayannopoulos's takeaways

  • Top takeaway Constantine argues this rare earth cycle is 'fundamentally different' from past crises (2010, 2000) because the US and other Western governments are finally injecting real capital into the sector, citing MP Materials, USA Rare Earth, Energy Fuels and Lithium Americas as named beneficiaries.
  • He breaks China's decades-long dominance down to three structural advantages: subsidized (sometimes negative) cost of capital, civilian demand that pulls supply chains forward, and a deep skills base with 39 Chinese institutions graduating rare earth specialists versus an aging Western talent pool.
  • He warns the West cannot win on the defense slice alone: defense is less than 2% of rare earth demand, so policy should instead nurture civilian demand (EVs, wind) and use OEM obligations to drive local supply chains, rather than picking individual winners.
  • He praises Brazil's BNDES critical minerals fund (~$1B, half taxpayer / half private capital) for allocating through private equity managers on capitalist principles rather than politically, and contrasts that with Canada and Australia, which he says risk being 'hewers of wood and drawers of water' if they do not capture more downstream value.
  • He argues catching China on volumes will be 'very, very difficult', but says the coming humanoid robot, drone and eVTOL demand wave is at serious risk of being captured by Chinese supply chains (over 90% of robots and roughly two-thirds of EVs are made in China), so the West needs to be 'much more focused and much more deliberate' in its investing.