Four decades ago, a rare earth processing plant on France’s Atlantic coast was one of the largest in the world, producing materials used in various industries. However, over the years, the plant’s output has diminished as Europe lost its dominance in rare earth processing to China.
The plant’s current owner, Solvay, is now racing to restore the plant’s former glory as Europe seeks to boost production of the minerals fueling the green energy transition. The plant’s history is a microcosm of the challenges Europe and the United States face in reversing the massive migration of rare earth processing to China that occurred around 25 years ago.
China became dominant in rare earths, a group of 17 minerals, by producing them at lower prices than the West, with the help of government support and often ignoring environmental concerns. In recent years, China has started to address sustainability and close polluting operations.
The La Rochelle plant’s output is now a fraction of China’s annual production, and it is focused on the kind of processed rare earths used for auto catalysts and electronics, not the type needed for permanent magnets used in electric vehicles (EVs) and wind energy. Solvay plans to start producing the latter by next year, but the company’s ambitious goal of supplying 20-30% of Europe’s separated rare earths demand for magnet production may not be achievable until after 2030.
Under a new EU law, the bloc has set ambitious 2030 targets for domestic production, recycling, and processing of critical minerals required for its green transition, including rare earths. However, according to industry forecasts and interviews, the EU is likely to struggle to meet most of these goals in rare earths, which could impact the bloc’s zero-carbon goals and increase dependence on China amid heightened geopolitical tensions.