Why is it so hard to get Rare Earths out of the ground?

When I was 6, I lived with my family in Jacksonville, Florida. Our house was a 5 minute drive from the beach and so we went all the time. It was called Mickler Beach. My friend's mom would often take me and some of the neighborhood kids to Mickler at sunrise to look for shark teeth. Unlike the more popular Ponte Vedra or Atlantic Beach, Mickler wasn't yet picked over. At age 6, finding shark's teeth in the sand was pretty much the coolest thing in the world. Later on in childhood, my family moved to Orlando, about 2 hours South of Jacksonville. New Smyrna was the new closest beach, about an hour East of Orlando. We'd go as a family for the weekend sometimes. At age 9, I remember my Dad explaining to me how a metal detector worked. At New Smyrna, there weren't shark teeth. But there were always one or two old guys holding sticks with discs on the end of them, hovering a couple inches above the sand. These old guys would wear headphones and stare blankly down the shoreline, sweeping the discs left and right.

Men and nations kill each other in pursuit of buried treasure needed to build new technology for economic and military purposes. One such new technology is high-temperature magnets in F-35 fighter jets. These magnets require dysprosium and terbium, 2 "heavy" rare-earth metals that are quite difficult to acquire. Without dysprosium and terbium, the US cannot credibly defend itself. And yet despite the name, these metals are actually quite common in the Earth's crust. You could certainly find traces of them in the sand at Mickler Beach.

The fundamental challenge with acquiring rare earths is that they are incredibly dispersed. In this case, "dispersed" means that they are spread out geographically and molecularly within a deposit. Terbium is found entwined with other minerals. This dispersion makes it nearly impossible to justify the staggering capital investment required for extraction at any single location.

Contrast this with the mechanics of oil. Oil migrates through porous rock for millennia and congregates into a massive subterranean reservoir. When humans discover oil, we are essentially poking a straw into a pre-filled tank. Similarly, gold resists bonding with other elements. This chemical isolationism allows gold to be concentrated by nature into pure deposits, which makes purification relatively easy.

Oil and gold are not "easy" to extract in a physical sense—they require massive rigs and deep shafts—but they are geographically congregated enough to make the math work. Rare earths, however, suffer from a "dispersion penalty." Because dysprosium and terbium are chemically "clingy," they bond instantly with oxygen, phosphorus, or silica, hiding inside host minerals like the monazite sands of Florida. They aren't in a reservoir, and they aren't in a vein; they are the rock itself. The cost of separation often exceeds the value of the find. In this sense, rare-earth metals are "rare".

This is part of the reason why Greenland is strategically important to the US. In the Kvanefjeld mountain range in southern Greenland, the extraction economics actually work given the density of the deposit (the third-largest deposit of REEs in the world). At Kvanefjeld, the REEs are bound to Uranium which has proven legally problematic for private companies aiming to harvest. In 2021, a new Greenlandic government came to power and passed a law banning any mining project where the uranium concentration exceeds 100 parts per million (ppm). The ore at Kvanefjeld sits at around 360 ppm of Uranium. This law effectively banned all REE mining at Kvanefjeld.

Beginning in 2016, an Australian company called Greenland Minerals (now called Energy Transition Minerals) held the license to mine Kvanefjeld. ETM initially tried to solve the REE extraction problem but quickly turned to a Chinese company called Shenghe Resources for help. In exchange for processing the REEs, Shenghe took a 12.5% stake in Greenland Minerals. After the 2021 ban, ETM sued the governments of Greenland and Denmark for a staggering $11.5 billion in damages. But by late 2025, an international tribunal ruled that it lacked the jurisdiction to decide the case, leaving ETM's fate—and the $11.5 billion claim—to the local Danish courts.

In an effort to make themselves a more attractive partner to Western governments, ETM has recently started distancing itself from Shenghe. In early 2026, ETM declared that the 2016 partnership had "effectively ceased," aiming to pivot the project away from Chinese influence and toward a Western-aligned supply chain. Shenghe, of course, is refusing to go away quietly, publicly disputing the termination and threatening legal action to protect its investment.

Kvanefjeld remains largely untouched today. REEs are still in short supply. Nature only concentrated them in a few specific places. In those few specific places, they are still hard to extract chemically. And this whole extraction process is probably not great for the environment, so the total cost of all externalities only increases. To Trump, the Greenland agenda is primarily about establishing a sovereign umbrella over those few places to lower that total extraction cost. If the US owns Greenland, we own the extraction laws.

If we own the beach, we can have all the shark teeth.