US to provide funding for Rainbow Rare Earths mining project listed in London amidst escalating competition with China

The US Government is set to bankroll London-listed miner Rainbow Rare Earths in developing a South African mine for key energy transition metals extraction. With China currently dominating the rare earth space, controlling 70% of mining and 90% of refined output, the US aims to support projects that can compete against this monopoly.

Rainbow Rare Earths will receive £40m from Washington’s US International Development Finance Corporation to build a plant in South Africa’s Kruger National Park. The site, located in the Phalaborwa region of North-Eastern South Africa, is almost unique in its low levels of radioactive material and high rare earth yields.

According to the United States Geological Survey, the global demand for critical minerals, including rare earth elements, is expected to surge by as much as 600% in the coming decade. As prices of rare earths have fallen by 63% since 2022, the West needs to ensure a stable supply chain to compete with China on price and supply.

George Bennett, Rainbow Rare Earths’ chief executive, emphasized the importance of projects like this in securing independence from China for critical elements used in green energy technologies. With the UK lagging behind in establishing a supply framework for rare earths, government commitments to such projects total just £15m.

As the demand for rare earths continues to rise, it is essential for the West to invest in projects like Rainbow Rare Earths to secure a stable supply and compete in the global market.