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29 September 2026
For decades, the global supply chain for rare earth elements has been highly concentrated, particularly at the processing and magnet-manufacturing stages. Rare earths are essential to permanent magnets used in electric vehicles, wind turbines, electronics and defence applications. China accounted for around 60% of global mined production of the magnet rare earths in 2024, but its dominance is far greater further downstream, representing around 91% of refined output and 94% of sintered permanent magnet production. Recent export controls have underscored the strategic importance of developing alternative supply chains given the surge in defence spending.
Saudi Arabia is emerging as an increasingly important part of that diversification effort. Earlier this month, the Kingdom announced that exploration and geological studies at Jabal Sayid in the Madinah region had identified an estimated 114 million tonnes of ore containing high concentrations of rare earth elements, particularly heavy rare earths, alongside promising uranium concentrations. The finding remains a resource estimate rather than an established commercial reserve, but it adds to Saudi Arabia’s broader ambitions to build a domestic mining and minerals industry.
The more immediate opportunity lies in processing. Mining has been designated a third pillar of Saudi Arabia’s industrial strategy under Vision 2030, with the Kingdom seeking to develop capabilities across exploration, extraction, processing and downstream manufacturing. In 2025, Ma’aden and US rare-earth producer MP Materials agreed to explore an integrated supply chain, while a subsequent binding term sheet provided for a joint venture to develop a rare-earth refining and separation facility in Saudi Arabia. The proposed facility is intended to process both Saudi and international feedstock, potentially giving the Kingdom a role in the midstream of the global supply chain.
Saudi Arabia’s substantial net foreign asset position provides an additional advantage, giving the Kingdom financial capacity to fund long-term industrial investment while its energy resources and infrastructure support the economics of energy-intensive processing. Combined with strategic ports and established industrial infrastructure, this strengthens the case for Saudi Arabia to develop beyond extraction and into higher-value mineral processing.
Brazil provides an important upstream complement. USGS estimates Brazil’s rare-earth reserves at around 21 million tonnes, placing it among the world’s largest holders, although current production remains modest. Its particular significance lies in ionic-clay deposits, which can contain valuable heavy rare earths such as dysprosium and terbium. Serra Verde’s Pela Ema operation in Goiás began commercial production in 2024 and is currently Brazil’s only operating ionic-clay rare-earth mine.
Alongside Australia’s established production and refining expansion, and developing projects in countries including the United States, Vietnam and India, these investments point towards a more geographically diversified rare-earth supply chain. The challenge, however, is substantial: the IEA estimates that existing and announced projects outside China could meet only around a quarter of projected refining demand and less than a fifth of magnet demand by 2035. For Saudi Arabia, that gap creates an opportunity to turn mineral resources, financial capacity, competitive energy and strategic infrastructure into a larger role in the global processing chain as the Kingdom pursues diversification beyond hydrocarbons.