The discovery of a significant deposit of rare earths in northern Sweden is a game-changer for the European Union’s efforts to reduce dependence on China in a strategically crucial sector.

The Swedish mining group’s announcement last week that it had uncovered what could be the largest deposit of rare earths in Europe to date is welcome news for the technological development and energy transition goals of the EU.

These materials are essential for the production of all-electric vehicles, wind turbines and other high-tech products, making the finding of a domestic source of rare earths a significant step towards greater autonomy in this vital area.

Rare Earth Discovery in Europe Boosts High-Tech Industry

Rare earth elements, such as scandium, yttrium, and neodymium, may not be household names, but they play a vital role in modern technology, including electric car batteries, smartphones, and wind turbines. As these metals have unique electromagnetic properties that make them essential to the high-tech and energy industries, they have become a strategic resource.

Unfortunately, Europe is heavily dependent on China for its supply of rare earths, with an estimated 98% of its rare earths imported from China. China is believed to possess around 40% of the world’s reserves, but the true extent of global reserves is not well understood.

The recent discovery of a new deposit of rare earths in Europe highlights the ongoing importance of exploring and developing domestic sources of these critical materials.

Rare Earths Abundant but Hard to Extract

Contrary to their name, rare earths are not actually scarce. These metals can be found in abundance in the earth’s crust, but not in a consistent manner.

The name “rare earths” originates from their infrequent discovery in ores during the late 18th century when their extraction began. Further exploration revealed that these metals are present in various rocks, yet often at low concentrations that make extraction difficult.

The process of separating rare earths from the ore they are found in and purifying them for use is challenging. Despite France’s advancements in extraction techniques, the country likely does not possess a sufficient deposit for profitable extraction.

Kiruna Mine a Boost for Europe, But Not Enough for Self-Sufficiency

The recent discovery of a rare earth deposit in the Swedish Far North may not comprise a large portion of global reserves, but it is a significant step forward for Europe in its efforts to reduce dependence on China. The exact size of the deposit remains to be determined, but it is estimated to potentially contain over 1 million tonnes of rare earths.

However, the Kiruna mine will not be operational in the near future. The mining company behind the discovery, LKAB, estimates it will take between 10 and 15 years to study the deposit, obtain necessary permits and begin operation. But LKAB’s manager believes that by 2035, the mine could produce a significant portion of the magnets used in electric car motors for Europe.

Despite the potential of the Swedish deposit, it is unlikely to fully eliminate the need for importing rare earths. Factors such as increasing demand, the deposit’s small size compared to those controlled by China or the United States, and European environmental and social standards that may not favor this type of operation, will continue to contribute to the need for imports.