With China's suspension of additional rare earth export controls set to expire in November, the state-funded Korea Institute of Geoscience and Mineral Resources is conducting a helicopter survey to find new domestic rare earth deposits. The government has already been widening its channels for securing rare earths through expanded overseas sourcing and stockpiling, and the push into domestic exploration signals that supply chain diversification is spreading across all fronts. Still, South Korea's reliance on China for rare earth materials and components used in electric vehicles, robots and wind power has topped 90% for the first time in nine years, prompting calls to extend diversification beyond raw materials to downstream processes such as separation and refining, metal and alloy production, and permanent magnet manufacturing.
According to industry sources on the 15th, the Korea Institute of Geoscience and Mineral Resources has designated an area of about 225 square kilometers stretching from Jeonui in Sejong to Gongju in South Chungcheong Province as a new promising zone for rare earths and has begun airborne radiometric and magnetic surveys. The institute plans to fly a total of 951 kilometers through the end of October to gather data before screening areas with potential deposits. If promising sites are confirmed, the work could lead to follow-up precision studies including surface geological surveys and sample analysis.
Heo Chul-ho, a researcher at the institute, said in a phone interview with The Seoul Economic Daily that a reanalysis last year of stream sediment samples collected nationwide and stored from 1997 to 2003 turned up meaningful geological indications of possible rare earth deposits in Jeonui in Sejong, Gongju in South Chungcheong Province and Suncheon in South Jeolla Province, and that follow-up surveys are now under way.
Public research institutes are searching for new rare earth deposits because supply chain instability stemming from China keeps growing. Last year China expanded export controls to cover finished magnets, refining technology and third-country transactions, and introduced extraterritorial controls that require licenses even for foreign products containing 0.1% or more of Chinese rare earths. Implementation has been suspended until Nov. 10. Heo said it takes more than 16 years to go from confirming a mineral through exploration and evaluation to production, adding that domestic resources need to be studied over the long term to prepare for supply chain instability.
The government and companies are also working in parallel to split rare earth supply chains into multiple channels. Abroad, they are securing non-Chinese raw materials, while at home they are building a recycling supply chain that recovers rare earths from discarded products. The government is pursuing an ecosystem for recovering rare earths from used permanent magnets and process scrap. The Korea Mine Rehabilitation and Mineral Resources Corporation, under the Ministry of Trade, Industry and Energy, is running a program this year to support facilities that produce recycled rare earth feedstock from end-of-life rare earth magnets and process scrap. The government plans to raise the recycling rate for 10 strategic critical minerals, including rare earths, to 20% by 2030.
According to a report on global rare earth supply chain realignment published on the 2nd by the KDB Future Strategy Research Institute, Hyundai Motor and Kia have signed long-term purchase agreements with Australia's Arafura Rare Earths and are working to secure NdPr oxide produced at the Nolans mine. LG Electronics last month began a business that recovers rare earth permanent magnets from compressors in discarded air conditioners and refrigerators. It aims to recover 1.6 tons of permanent magnets a year from about 40,000 discarded appliances.
The government last year also created an emergency mobilization mine system that would allow domestic mines to be tapped if a crisis hits supply chains for strategic minerals such as rare earths. The institute recently published a paper surveying domestic rare earth deposit areas including Sancheong, Chungju and Hongcheon and proposed them as candidate sites for the system.
Some observers caution, however, that while dependence on China can be reduced at the raw material stage by diversifying sourcing, the concentration in China of downstream processes such as separation and refining, metal and alloy production, and magnet manufacturing will be hard to resolve in the short term. According to the institute's analysis of rare metal raw material trade obtained by The Seoul Economic Daily, South Korea's dependence on Chinese imports for rare earth raw materials stood at around 50% in 2025 thanks to diversified overseas sourcing, but China's share of materials and components imports topped 90% last year for the first time since 2017. Because China holds overwhelming competitiveness not only in mining but also in separation and refining, metals and alloys, and permanent magnet manufacturing, the structure leaves the country reliant on China again at the stage of making final materials and components.
Industry officials said that with China set to implement a second round of rare earth export controls extending to downstream areas such as finished magnets, refining technology and production equipment as soon as the suspension expires in November, stabilizing the rare earth supply chain requires building non-Chinese supply chains at home and abroad spanning separation and refining, metal and alloy production and magnet manufacturing, not just securing mines and raw materials.
