Why Rare Earths, Nuclear Treaties, and Power Grids Connect

Why I’m Watching Rare-Earth Supply Chains, Nuclear Treaties, and the Energy Industry Together

On February 5, 2026, the New START treaty between the United States and Russia expired. It was the treaty that capped how many strategic nuclear weapons each country could deploy. It also included procedures for each side to verify what forces the other actually had in place. NTI explainer

I’ve been following that news alongside shifts in rare-earth supply chains and the power-grid and electric-vehicle industries. These are separate stories, but together they expose conditions that you simply can’t read off a politician’s statement when you’re trying to understand relations between states. Where a country can actually source the materials it needs, how much it can verify about a rival’s military capacity, and who manufactures the energy equipment—these are the things that shape the real choices being made.

Rare Earths Are About More Than Just Mining

Rare earths are the raw material for the permanent magnets used in EV motors and wind turbines. Securing the ore doesn’t mean you can make a magnet right away. What follows has to be a process of separating and refining the necessary elements, then processing them into magnets.

In 2024 data compiled by the IEA, China accounted for about 60% of mining for magnet-grade rare earths and about 91% of separation and refining. For neodymium-based permanent magnet production, it was about 94%. Statistics on total rare earth mining and statistics on magnet-grade materials cover different things, so they need to be read separately. IEA analysis

Refining is technically complex, and depending on the ore, facilities are also needed to manage radioactive byproducts like uranium or thorium. There are, in other words, several stages between finding a mine and building a stable supply chain. When I look at China’s advantage, what stands out to me is that this process and this infrastructure were built up over a long period of time.

The US is also trying to expand its production base. In July 2025, MP Materials announced a partnership in which the US Department of Defense would purchase $400 million in convertible preferred stock and secure rights to buy additional shares. The 15% stake figure assumes conversion of the preferred stock and exercise of those rights. The partnership also includes a guarantee that defense and commercial customers will purchase the entire magnet output of a newly built 10X facility for 10 years after it starts operating. MP Materials announcement

Turning this kind of investment into actual supply takes time. In a 2024 study, S&P Global estimated that mines surveyed in the US take about 29 years on average from discovery to production. That figure covers multiple mineral types, including copper and lithium, and includes projects not yet in production, assuming a 2030 start date. It doesn’t mean every rare earth mine necessarily takes 29 years. S&P Global study description

That’s why I think we need to separate a declaration of intent to shift suppliers from the point at which materials are actually delivered. Only by checking not just new mine development but also the expansion of existing facilities, refining capacity, and the operating timelines of magnet plants can we judge how much dependence on China can realistically be reduced.

What limits disappeared when New START expired

New START capped deployed strategic nuclear warheads for both the US and Russia at 1,550 each, under the treaty’s counting rules. Deployed intercontinental ballistic missiles, submarine-launched ballistic missiles, and heavy bombers combined were capped at 700, while launchers and heavy bombers including non-deployed ones were capped at 800. This was not a treaty limiting the total number of all nuclear warheads either country possessed.

The treaty, which entered into force in 2011, included a single five-year extension option, which both countries exercised in 2021. Maintaining quantitative limits and verification beyond expiration would require a new agreement. NTI explainer

Verification functions didn’t simply stop the day the treaty expired. On-site inspections were suspended during COVID-19 and never resumed, and when Russia declared it was suspending participation in 2023, the treaty’s information exchanges were severely damaged as well. The expiration of legal quantitative limits came on top of a verification system that was already weakened.

There are still procedures based on separate agreements, such as notifications of ballistic missile launches. So it’s not accurate to say every legal obligation or channel of communication related to nuclear weapons has disappeared. Still, the task of restoring an agreement that limits deployed forces and lets each side verify the other remains unresolved. US-Russia arms control procedures explainer

What worries me isn’t just the possibility that warhead numbers will grow — it’s that verifying the other side’s behavior is becoming harder. If each side responds by assuming worst-case scenarios, arguments for expanding arsenals further could gain traction.

Power and related manufacturing are becoming more important

In the energy competition, the ability to produce power generation equipment, batteries, and electric vehicles matters just as much as oil and gas resources. I see this shift as a widening of the competitive field—from oil-centered influence to power and manufacturing capability.

China has built a massive production base in this area. According to the IEA, nearly two-thirds of the world’s newly connected renewable power capacity in 2024 was installed in China. Renewables made up about 35% of China’s electricity generation, but coal still accounted for roughly 60%. Rapidly expanding renewable capacity is not the same thing as ending fossil fuel dependence. IEA electricity analysis

Canada’s choice also caught my attention. Prime Minister Mark Carney announced on January 16, 2026, a plan to apply a 6.1% tariff rate to up to 49,000 Chinese-made electric vehicles. The stated goal was to boost the competitiveness of Canadian industry and consumer access by tapping into China’s EV technology and supply chains. This is not unlimited openness to all Chinese EVs. Canadian PM’s announcement

When I evaluate China’s Belt and Road Initiative, I don’t just look at how many roads or ports have been connected. I think we also need to look at how the relationships built through supplying and financing energy infrastructure affect partner countries’ choices. Regardless of whether individual projects succeed or fail, the capacity to offer technology, equipment, and financing together is hard to leave out when assessing competitiveness.

We should also count the cost of tariffs and aid cuts

Tariffs get used as a diplomatic bargaining chip, but the country on the other side of the table isn’t the only one footing the bill. If exporters don’t lower their prices, importers absorb the extra cost, and companies then have to either eat it out of their margins or pass it on in retail prices.

In an analysis published in February 2026, researchers at the Federal Reserve Bank of New York estimated, using import data through November 2025, that nearly 90% of the tariff burden had fallen on American businesses and consumers. That doesn’t mean individual American consumers directly paid 90% of the cost — the figure comes from analyzing, based on import prices, how the burden was actually split between foreign exporters and the US side. The researchers’ analysis

Aid budgets deserve the same kind of scrutiny. In June 2025, the OECD projected that, factoring in cuts announced by major donor countries, official development assistance for that year could fall by 9 to 17%. It expected poorer countries and vulnerable populations to bear the brunt. That was a projection made at the time, not a final tally. OECD report

I think Europe now faces a harder choice in trying to maintain both domestic welfare and international support at once. Cutting aid may save money in the short run, but if it deepens instability in the regions that once received that support, other costs can emerge down the line. Along with the stated rationale behind a policy, we need to look at who actually ends up paying for it.

Oswarld’s Lens

Having spent my career doing data analysis, the more uncertain a situation feels, the more I want to check the underlying data first. Whether you agree with a country’s policies and how you assess that country’s production capacity are two entirely separate judgments.

The rare-earth and electricity data that explain China’s competitiveness aren’t Chinese government promotional material — they’re IEA analysis. For US mine development timelines I looked at S&P Global, and for tariff burdens I looked at research from the Federal Reserve Bank of New York. Having a source doesn’t automatically make every interpretation correct, but it does give me grounds to examine conclusions I find uncomfortable.

When building GTM strategy, I’ve always been wary of dismissing competitors out of emotion. Even if I don’t like a competing product, I still need to understand why customers choose it and what strengths it has in supply capacity and pricing. I apply the same standard when looking at competition between nations.

In the rare-earth supply chain, I try to look at refining and processing capacity; in nuclear arms control, at quantity limits and verification procedures; in the energy industry, at power supply and manufacturing capacity. A conclusion built only on liking or disliking a country can’t explain these distinctions. I believe you can only build a concrete response once you understand the strengths your opponent actually holds and how long it would take you to change that.

The author is Oswarld (Kwangseob Ahn). Current roles: Adjunct Professor at Sejong University, Strategy Consultant at INLEVEL9. Career, research, books, and recent work are kept current on the About page. Latest · July 2026: HEMA-2: A Consolidation-Aware Tri-Memory Architecture with Multi-Channel Scheduling for Lifelong Conversational AI.