Swedish mining company LKAB has discovered Europe’s largest deposit of rare earth oxides in the Kiruna area, located in the far north of Sweden, which could potentially reduce the continent’s reliance on China for this critical resource. Rare earth minerals play a vital role in the production of clean energy, electric vehicles, and consumer electronics, but the market is currently dominated by China, which accounts for 60% of global production according to the US Geological Service.
Currently, no rare earth elements are mined in Europe, leaving the continent dependent on imports. The European Union gets 98% of its minerals from China, according to the European Commission. However, with the increasing demand for electrification, the global supply of these minerals is expected to fall short at a time of increasing geopolitical tensions. The company added that the region’s dependence on China for rare earth minerals increases the vulnerability of European industry.
LKAB’s discovery of over one million tonnes of rare earth oxides in the Kiruna area is being hailed as good news for not just LKAB, the region, and the Swedish people, but also for Europe and the climate. Ebba Busch, Sweden’s Minister for Energy, Business and Industry, said in a statement that “Electrification, the European Union’s self-sufficiency and independence from Russia and China will begin in the mine. We need to strengthen industrial value chains in Europe and create real opportunities for the electrification of our societies.”
However, the road to mining these deposits is a long one. LKAB plans to submit an application for a permit later this year. The company estimates that it will be at least 10-15 years before it can begin mining and delivering raw materials to the market.
Given its importance in the tech industry, rare earth have become a key front in the US-China competition as well. The United States, which has long relied on China for these minerals, is seeking to strengthen its domestic supply chain to emerge as a dominant global player. In 2021, the Biden administration targeted rare earth, among other domestic supply chain priorities, to reduce the vulnerability of these industries to geopolitical tension.
This discovery by LKAB could be a game-changer for Europe, as it could potentially reduce its dependence on China for a resource that is vital for many industries. However, the process of mining and extracting these rare earth oxides is a long and complex one, and it will be some time before the benefits of this discovery can be fully realized.