Why Is This Rare Earth Metal 346 Times More Expensive In America Than in China? | OilPrice.com
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By Michael Scott – Nov 01, 2026, 7:00 PM CST
Samarium sells for as much as 346 times more in North America than in China, and that price is just a preview of what American industry would pay the day Beijing stops exporting.
Jet engines, industrial motors, EVs, wind turbines and medical scanners all run on rare earth magnets, and most U.S. manufacturers still buy theirs from China, at Chinese prices.
Outside China, dysprosium costs five times as much and yttrium more than 100 times as much. Japan has already learned what happens when the Chinese supply slows: its government is asking Washington for help before its yttrium runs out at year-end.
REalloys (NASDAQ: ALOY) is positioning itself to profit from one of the most serious shortages developing in America’s rare earth supply chain, and it’s a shortage that billions of dollars in new mining and magnet manufacturing investments won’t solve on their own.
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Washington has begun intervening to protect domestic production from Chinese price competition. Under its 10-year agreement with MP Materials, the Pentagon guarantees a minimum price of $110 per kilogram for NdPr, making up the difference when benchmark prices fall below that level. The arrangement protects MP Materials against the price collapses that have historically threatened Western rare earth producers.
But in the meantime, investment in new mines and magnet factories is accelerating, creating an increasingly urgent question: who will supply the rare earth metals and alloys needed to connect the two?
That’s where REalloys is concentrating its efforts. For magnet manufacturers, rare earth oxides first have to be reduced to metal, then melted with other materials and cast into the alloy strip that feeds the magnet line.
China controls more than 90% of the world’s 210,000 tonnes of capacity for that step, according to Canaccord Genuity, whose analysts call metallization “a major blind spot in western supply chain development.” The strip casters that make the alloy now take up to two years to deliver, and Canaccord’s channel checks found that buying them from China is “impossible under current export controls.”
Canaccord expects magnet plant capacity outside China to more than triple to about 70,000 tonnes by 2030. Non-Chinese metal and alloy capacity, however, is expected to reach just 38,000 tonnes over the same period, roughly half of what those new magnet plants will need.
Every Western magnet line that opens without its own metal supply will have to buy from China or compete with other Western plants for limited alternative supplies.
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ING has warned that China’s grip may outlast this decade because the bottleneck is “industrial rather than geological.” American manufacturers buy about 48,000 tonnes of rare earth magnets a year, and in 2025 the U.S. made just 300 tonnes.
REalloys already operates a facility in Euclid, Ohio, producing rare earth metals, alloys and magnet materials. The company says it has the only operating heavy rare earth metallization capability in North America, giving it an early position in the industrial process that Canaccord expects to become increasingly scarce.
The company has also secured non-Chinese feedstock to support its expansion. It holds rights to approximately 80% of the Saskatchewan Research Council’s expanded output, including roughly 525 tonnes of NdPr metal annually, alongside dysprosium and terbium products. It also has a 15-year offtake agreement covering 15% of Phase 1 production from Critical Metals Corp.’s (NASDAQ: CRML) Tanbreez project in Greenland.
Under a Defense Logistics Agency contract, it is designing a 300-tonne-per-year facility for samarium and gadolinium metal, two materials with no established commercial production in the United States. Samarium currently commands a price premium of as much as 346 times its Chinese price in North America, illustrating the extraordinary economics of supply outside Beijing’s control.
REalloys reported $122.4 million in cash at the end of June and says its Saskatchewan and metallization expansions are fully funded. With Western magnet manufacturing capacity projected to grow far faster than non-Chinese metal production, REalloys is building capacity in the part of the supply chain where manufacturers could face some of their toughest shortages.
The Next Wave of Rare Earth Demand Could Dwarf the Last
By 2035, the world could need 365,000 tonnes of rare earth magnets a year. And Canaccord Genuity has just raised that forecast by another 15%, as EVs, data centers, drones and humanoid robots push demand beyond its earlier projections.
The bank expects global NdFeB magnet demand to grow 7.3% annually, with EV sales more than doubling from 23.5 million this year to 52 million in 2035.
Canaccord analyst Reg Spencer has also pointed to the growing demand from data centers, e-bikes, scooters and drones. Drones account for only about 1% of forecast demand, but Ukraine and Russia alone were estimated to produce some 9 million military drones, and Canaccord acknowledges that its estimates may prove conservative.
And Canaccord may still be underestimating one of the biggest emerging sources of demand: humanoid robots. <a href="https://oilprice.com/Metals/Commodities/Why-Are-Rare-Earth-Stocks-Falling-When-Prices-Ke
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