In a world increasingly defined by the scramble for critical minerals, two events this September have underscored the shifting landscape of global supply chains and the urgent race to secure rare earth elements. On September 22, 2025, Seoul played host to the Mongolia-Korea Critical Minerals & Mining Investment Forum, a gathering that spotlighted the deepening partnership between Mongolia and South Korea. Meanwhile, new trade data and industry developments revealed the mounting tensions and strategic maneuvers surrounding China’s dominance in rare earth metals—a sector crucial for everything from electric vehicles to national defense.
The stakes are high. As Vice Minister of Trade, Industry and Energy Lee Ho-hyeon told attendees in Seoul, "Recently, amid global instability in critical mineral supply chains from the U.S.-China strategic rivalry and China’s export controls, as well as major transformations in the energy market, Korea and many other countries are accelerating efforts to strengthen the security of critical minerals." According to The Korea Times, Lee emphasized that Mongolia’s vast reserves—molybdenum, nickel, and tin among them—could be the missing link for Korea’s high-tech industries, which include semiconductors, electric vehicles, and batteries. These industries, Lee noted, are heavily reliant on a steady stream of critical minerals.
But why Mongolia, and why now? The answer lies in the shifting sands of global trade. China, long the world’s rare earth powerhouse, has tightened its grip on the sector. According to Chinese customs data released on September 20, China shipped 6,146 metric tons of rare earth permanent magnets in August 2025—a 10.2 percent jump from July and 15.4 percent higher than the previous year. This was the highest monthly total since January. The European Union emerged as the top customer, importing 2,582 metric tons, a 21 percent increase from July. The United States, however, saw a 4.8 percent drop from July and an 11.8 percent decrease from August 2024, importing only 590 metric tons.
Such numbers matter because rare earth metals—seventeen in total—are the backbone of modern technology, powering everything from wind turbines and electric cars to nuclear submarines. China’s control is staggering: it commands 61 percent of global extraction and 92 percent of refining production, according to the International Energy Agency. In April, Beijing expanded its export controls to cover seven rare earth metals and magnets made from three of these elements, a move that sent shockwaves through defense, electronics, and automotive supply chains worldwide.
This tightening followed a tit-for-tat escalation in trade measures. After former U.S. President Donald Trump imposed steep tariffs on Chinese exports, Beijing’s export controls were seen as a calculated response. At a White House event on August 25, Trump referenced the leverage these supply chains can create, saying, “I sent them all of the parts so their planes can fly. I could have held them back. I didn’t do that because of the relationship I have. And they’re flying.” The implication was clear: in today’s interconnected world, materials and components are as potent as any diplomatic tool.
It’s no wonder, then, that nations are scrambling to diversify their sources. The Seoul forum saw a flurry of activity aimed at just that. Memorandums of understanding were signed between Mongolia’s state-owned Erdenes Mongol and Korean firms including Korea Mine Rehabilitation and Mineral Resources Corp. and Samsung C&T. These agreements, according to the Ministry of Trade, Industry and Energy, lay the groundwork for joint development and supply of critical minerals.
Uchral Nyam-Osor, Mongolia’s first deputy prime minister and minister of economy and development, captured the spirit of the moment in his opening remarks: “We are working to combine Mongolia’s abundant natural resources with Korea’s high-tech industries, processing capacity and advanced technologies, thereby creating a stronger partnership and enabling businesses of both countries to compete together on the global market.” Mongolia, he added, is "open to trade and investment, implementing favorable conditions to attract and secure foreign capital… We are confident these efforts will encourage more foreign investors in Mongolia."
For Mongolia, the stakes are enormous. The country is seeking to move beyond simply exporting raw materials. Presentations at the forum highlighted Mongolia’s evolving mining policy and its commitment to building a robust, value-added mining supply chain. Damdinnyam Gongor, Mongolia’s minister of industry and mineral resources, announced that a joint research center on rare metals would open between Mongolia and Korea in November. "I am confident that once operational, this joint center will greatly advance rare metal research, exploration, processing and development," he said. The center aims to foster innovation and ensure both countries remain competitive in the global marketplace.
Yet, the world’s dependence on China is proving hard to break. Even as Korea and Mongolia take steps to deepen their partnership, and as the United States and its allies invest in alternative sources, China’s dominance persists. In July, the Pentagon poured $400 million into MP Materials, making it the company’s largest shareholder and aiming to kick-start commercial magnet production later this year. And just as the Seoul forum was underway, Canada’s Neo Performance Materials inaugurated Europe’s first large-scale rare earth magnet factory in Estonia. With contracts from German automakers Schaeffler and Bosch, the Estonian facility is expected to produce 2,000 metric tons of magnet blocks each year, with ambitions to more than double that output in the coming years.
All these efforts reflect a broader trend: governments and industries are racing to secure supply chains for materials that underpin the technologies of tomorrow. As Vice Minister Lee put it, "Our cooperation (should further) lead to concrete joint development and investment projects between private enterprises," underscoring the need for public and private sectors to work hand in hand. The Korean government, he added, "will also expand its support for overseas resource development, including financing for overseas resource exploration, as well as tax, policy and financial measures, in order to actively support the entry of Korean companies into Mongolia."
For now, the world is watching as new alliances take shape and old dependencies are tested. The Mongolia-Korea partnership, born of necessity and ambition, may well serve as a model for others seeking to navigate the uncertainties of the global minerals market. With the opening of the joint research center on the horizon and fresh investments flowing into new production facilities, the race for rare earths is far from over. The next chapter, it seems, will be written not just in Beijing or Washington, but in Ulaanbaatar, Seoul, and beyond.
