Ore from a single Chinese mine complex fed the production of 170,000 tonnes of rare-earth metal last year, according to David Merriman, research director at the minerals intelligence firm Project Blue. That figure, anchored in the Bayan Obo mine in Inner Mongolia, frames the scale problem now facing Western governments as they spend billions rebuilding rare-earth supply chains around monazite, a thorium-bearing ore China itself restricts at home.

The cautionary example sits 150 kilometers south of Bayan Obo, in the city of Baotou. There, a 10-square-kilometer artificial lake held back by the Weikuang Dam has collected effluent from decades of iron, steel, and rare-earth processing. The lake's contents include substantial amounts of radioactive thorium, which comes mainly from processing monazite ore (a phosphate mineral rich in rare-earth elements and typically carrying thorium as a companion). Largely because of this environmental legacy, China does not permit stand-alone monazite mines — sites where nothing but monazite is extracted.

That restriction has not slowed Chinese output. Monazite is a prime source of dysprosium, terbium, yttrium, and erbium — elements used in magnets, phosphors, and fiber-optic amplifiers. Roughly 30 to 40 percent of the rare-earth ore mined at Bayan Obo is monazite. The mine remains legal because its primary product is iron ore, with bastnaesite (a rare-earth fluoride carbonate) as the main rare-earth mineral. Bayan Obo alone supplies nearly half of all rare-earth ore mined on the planet in a typical year.

How much monazite does China import?

Beyond domestic mining, China imported more than 70,000 tonnes of monazite ore last year, according to Thomas Kruemmer, a Singapore-based consultant on minerals and metals. Moving that volume is not routine logistics. Concentrated monazite is Class 7 dangerous cargo under the International Maritime Dangerous Goods Code, because of its radioactivity, and can enter China through only four ports.

Import channels are also formally narrow. Certain kinds of monazite are supposed to pass through a joint venture of the China National Nuclear Corp. and Shenghe Resources, both at least partly state-owned. In practice, much of the ore bypasses that structure. Heavy mineral sands, which contain roughly 2 or 3 percent monazite by weight, fall outside the import controls applied to concentrated monazite. Companies import the sands, separate the marketable concentrates, and then process the monazite concentrate for its rare earths.

Why is China stepping up acquisitions abroad?

One driver is supply replacement. In 2025, the U.S. government invested $400 million in MP Materials, operator of the Mountain Pass mine and processing facility in California. The deal ended long-standing contracts under which MP Materials sold tens of thousands of tonnes of rare-earth concentrate annually to a trading affiliate of Shenghe Resources. China has since moved to secure rare-earth ore elsewhere, and some Western analysts read a strategic motive: locking down rights to foreign deposits makes them unavailable to non-Chinese developers.

Merriman cautions that the interpretation depends on vantage point. The U.S. government recently made a conditional loan commitment of up to $725 million to Energy Fuels, a monazite processor that has secured supplies in Australia, Brazil, and Madagascar. To a Chinese observer, those moves look equally strategic.

What does this mean for R&D portfolios?

For research managers and procurement leads, the numbers define the gap. A domestic Western monazite strategy must compete against a country that processes more monazite than anyone else as a by-product of iron mining, imports over 70,000 tonnes a year through a restricted port network, and has already internalized the thorium-handling costs — costs that China now regulates so strictly it bans dedicated monazite mines on its own territory.

Radiological handling, waste disposal, and licensing for thorium-bearing feedstock remain line items that any monazite processing program outside China will have to budget from the outset, given the documented legacy at Baotou.

Merriman's summary is blunt: "China's playing its game." Whether the $400 million at Mountain Pass and the $725 million at Energy Fuels change that calculus will become clear as those facilities scale, and as China's next round of monazite imports is tallied.