South Africa and the US Team Up on a Rare‑Earth Mine

Why the Mine Matters

Despite occasional political friction between South Africa and the United States, the two countries are cooperating on a mining venture that could reshape how America obtains critical minerals. The project, called the Phalaborwa Rare Earths Project, is set to start production in 2028. The U.S. International Development Finance Corporation (DFC) will contribute $50 million toward a total budget of $317 million. The goal is to extract rare‑earth oxides that can be used in permanent magnets—key components for electric vehicles, wind turbines, and many high‑tech devices—thereby reducing reliance on Chinese supplies.

From Waste to Magnet Material

The mine will not dig fresh ore from the ground. Instead, it will reprocess gypsum waste left over from older mining activities. Gypsum, a soft mineral commonly seen in plaster and drywall, contains trace amounts of rare‑earth elements. By treating this waste, the project extracts, processes, and separates rare‑earth oxides ready for use in magnets. This approach turns an environmental liability into a valuable resource while keeping operating costs low.

Gypsum’s Double Life in Farming

Although the project’s main focus is rare‑earths, gypsum itself has a long agricultural history. In South Africa, gypsum has been used since the 1960s as a soil conditioner and fertilizer. It improves soil structure by breaking up heavy clay, enhances water infiltration, and supplies calcium and sulfur to crops. The same material that will soon feed high‑tech magnets has been helping farmers grow better harvests for decades.

Food Prices and Global Tensions

Fertilizer prices have been rising because of supply disruptions linked to conflicts, including the war in the Middle East. Higher fertilizer costs can push up food prices, which in turn may affect inflation. South Africa’s food‑inflation rate eased slightly to 3.6 % in March, but analysts warn that continued pressure on nitrogen‑based fertilizers could reverse that trend. At the same time, the country expects a record summer grain and oilseed harvest in the 2025‑26 season, thanks to good rains and expanded planting—offering some relief to consumers.

The Growing Demand for Rare‑Earth Magnets

According to the DFC, worldwide demand for rare‑earth oxide magnets is projected to increase by about 7.5 % each year through 2040. This growth is driven by the expansion of electric vehicles, renewable‑energy installations, and advanced manufacturing. By securing a steady supply of these magnets domestically, the United States aims to strengthen its technological edge and protect supply chains from geopolitical shocks.

Jobs and Economic Impact

Mining contributes roughly 8 % to South Africa’s gross domestic product, although output has dipped below pre‑pandemic levels due to power shortages, logistics bottlenecks, inflation, and currency swings. The Phalaborwa project promises to create full‑time local jobs, boost exports of rare‑earth oxides, and stimulate ancillary industries such as equipment servicing and transportation. A second notable site, the Steenkampskraal mine in the Western Cape, already supplies neodymium and praseodymium—essential metals for the same magnets used in EV motors and wind turbines.

Steenkampskraal – Another Key Site

Unlike Phalaborwa, Steenkampskraal extracts rare‑earths directly from ore rather than waste. Its focus on neodymium and praseodymium complements the gypsum‑based approach, giving South Africa a diversified rare‑earth portfolio. Together, these projects could position the country as a reliable supplier for global high‑tech markets.

What This Means for Teens

For students interested in science, technology, or environmental stewardship, the partnership illustrates how old mining leftovers can become tomorrow’s clean‑energy materials. It shows that solving big challenges—like securing clean power and feeding a growing population—often requires creative thinking, international teamwork, and a willingness to look at waste as a resource.

Conclusion

The Phalaborwa Rare Earths Project exemplifies a pragmatic blend of economics, environment, and diplomacy. By converting gypsum waste into valuable rare‑earth oxides, South Africa and the United States are working together to reduce dependence on foreign mineral supplies, support green technologies, and create local jobs. At the same time, the project highlights the interconnected nature of mining, agriculture, and global markets—reminding us that solutions to one challenge can often bring benefits to another.