South Korea Reveals Plan to Secure Rare Earth Supply

South Korea's government has launched a comprehensive national strategy to reinforce its supply chain for rare earth elements, addressing the country's heavy dependence on China for materials critical to advanced industries.

The Ministry of Trade, Industry and Resources announced the first-of-its-kind plan, highlighting the essential role rare earths play in strategic sectors like semiconductors, electric vehicles (EVs), and defense. The strategy aims to build national capacity across every stage of the supply chain, from raw material extraction to final product manufacturing.

Vice Industry Minister Moon Shin-hak outlines the government's new rare earth strategy at a joint public-private meeting in Seoul on October 16, 2025.

A Full-Spectrum Approach to the Supply Chain

The core of the strategy is to develop capabilities throughout the entire rare earth value chain. This includes:

• Upstream: Supporting resource development and mining.

• Midstream: Enhancing the separation and purification of rare earth elements.

• Downstream: Turning refined elements into usable materials, such as permanent magnets for industrial use.

Balancing Global Partnerships and Diversification

To ensure stability, the government will pursue a multi-pronged international approach. In the short term, it plans to expand cooperation with China, the dominant global supplier, alongside resource-rich nations like Vietnam and Laos to prevent immediate supply chain disruptions.

Simultaneously, Korea will seek deeper collaboration with major economies, including the United States, Japan, and Australia. The government also plans to participate in global supply chain initiatives like the Indo-Pacific Economic Framework for Prosperity (IPEF) to build a more resilient network.

Boosting Domestic Production and Investment

A key pillar of the plan is to foster domestic capabilities and reduce foreign reliance. The government will actively support private companies leading overseas resource development projects.

To fuel this growth, the government is implementing several financial measures:

• The loan program for overseas resource development will be increased to 67.5 billion won ($46.2 million) this year, a significant rise from 39 billion won in 2025.

• Policy finance will also be expanded to support key projects.

• Companies investing in domestic production facilities will receive government support.

• To stimulate local demand, the government will prioritize stockpiling rare earths produced within Korea.

The strategy also includes establishing a robust resource recycling ecosystem to recover rare earth elements from used EVs and home appliances.

Developing Independent Technology and Expertise

Finally, the plan outlines a roadmap for developing independent technologies for the separation and purification of rare earths. This focus on technological sovereignty extends to creating advanced resource recycling methods, aiming to build a self-sufficient and circular economy for these vital materials.