Donald Trump has set aside long-standing tensions with South Africa in order to secure access to rare earth minerals from a former industrial site in northern Limpopo Province.
The United States has pledged a $50 million investment into the project, even as diplomatic relations with South Africa remain at one of their lowest points in decades.
What were once waste dunes from an old chemical processing facility now contain valuable rare earth elements that are highly sought after for modern technologies.
The project, known as the Phalaborwa Rare Earths Project, is receiving support through a $50 million equity injection from the US International Development Finance Corporation (DFC), a government development finance institution.
The move forms part of Washington’s broader strategy to reduce dependence on China, its major competitor in critical mineral supply chains.
Rare earth minerals are essential components in electronics, robotics, defence equipment, electric vehicles, and other advanced technologies.
Alongside rare earths, minerals such as lithium, cobalt, copper, and nickel are also classified as critical due to their importance in modern innovation, with rare earths forming a distinct group of 17 elements.
The Trump administration is also working toward establishing a strategic reserve worth nearly $12 billion to secure access to such resources.
Although the DFC was created during the first Trump presidency and later continued under the Biden administration, its backing of the project has persisted despite renewed political friction after Trump’s return to office and an executive order cutting financial assistance to South Africa.
Despite diplomatic strain, the agency has framed its involvement as part of efforts to unlock Africa’s mineral wealth while advancing US strategic priorities.
The Phalaborwa initiative is being developed by Rainbow Rare Earths, with no direct ownership stake held by the South African government.
Project director Alberto Bruttomesso explained that the operation is designed as an environmental recovery effort, extracting valuable metals from phosphogypsum waste rather than through conventional mining.
He noted that the process involves treating the waste material and recovering rare earths in what he described as a first-of-its-kind global approach, highlighting that the method effectively turns an environmental liability into a resource.
According to him, much of the initial processing has already been done by previous industrial activity, which reduces some of the energy-intensive stages typically required in rare earth extraction.
The project is expected to run for around 16 years and aims to begin production in 2028, working with approximately 35 million tonnes of phosphogypsum deposited over time from phosphate processing.
Funding from the US will be released once construction of the processing facility begins, which is anticipated in early 2027.
Rare earths are naturally widespread but occur in low concentrations, making them expensive and complex to separate and refine.
Independent assessments suggest the project’s innovative above-ground extraction method makes its commercial potential difficult to predict at this stage.
Developers, however, argue that the operation could be significantly cheaper than traditional mining and may rely heavily on renewable energy—up to 90% of its power requirements.
Metallurgical specialist Roux Wildenboer described the approach as both a resource recovery and environmental rehabilitation effort, noting that it reduces the environmental footprint compared to conventional mining while still supplying materials needed for green technologies.
Company leadership has indicated that production is expected to supply key markets in the United States, particularly sectors linked to defence systems, where rare earths are essential for advanced military technology.
Chief executive George Bennett said discussions are ongoing for long-term supply agreements, with demand expected from Western markets, especially the US.
He added that rare earth materials are widely used in defence platforms such as fighter jets and submarines, underscoring their strategic importance in military systems.
Rainbow Rare Earths plans to produce elements including neodymium, praseodymium, dysprosium, and terbium, which are critical for high-performance magnets used in wind turbines, electric vehicles, robotics, and defence applications.
The Trump administration has also expanded its focus on securing critical minerals domestically and internationally, including engagements in regions such as Ukraine and interest in resources in Greenland.
In addition, the US Trade and Development Agency has supported feasibility studies for similar projects in neighbouring countries, including rare earth developments in Mozambique.
Researcher Alseno Mosai from the University of Pretoria noted that the South African site is unusual because the minerals are already near the surface, unlike other countries where deeper excavation is required.
He suggested that the project could place South Africa among the few countries with a highly efficient rare earth recovery process, second only to China.
He also observed that despite political tensions, the US remains aware of South Africa’s mineral wealth and continues to seek access to it.
Additional US-backed infrastructure efforts in Africa include support for the Lobito Corridor, an 800-mile railway designed to connect mineral-rich regions of Democratic Republic of Congo and Zambia to the Atlantic coast for export markets.