Russia possesses one of the world’s largest reserves of rare earth metals (REM)—about 5.5% of global reserves, according to estimates by the Federal State Budgetary Institution “VIMS” for 2025. However, the country’s share in raw material processing and finished product manufacturing remains low. Antonina Levashenko, Head of the International Best Practices Analysis Department at the Gaidar Institute, spoke to the newspaper “Vzglyad” about the reasons for this gap and the measures needed to develop the industry.
One of the main problems lies in the characteristics of Russian ores and domestic demand. When processing raw materials, several rare-earth elements must be extracted simultaneously, even though demand for them varies. About 90% of the mined raw materials consist of cerium, lanthanum, and neodymium, whereas the global market also has a particularly high demand for praseodymium, dysprosium, and samarium. At the same time, Russian ores tend to have a relatively low rare-earth content, which complicates and increases the cost of their extraction.
The domestic market is also fragmented: according to Rosnedr estimates, rare-earth metals are needed by approximately 130 Russian companies, each of which may require only a few metric tons of a specific product per year. This makes it difficult for specialized production facilities to turn a profit and explains why part of the country’s demand is met through imports.
The example of China shows that having large reserves is not enough to develop the industry. The country has established a complete production chain—from mining to the production of individual metals, alloys, and compounds. This was facilitated by government oversight, investment support, and steady demand from industry.
“For Russia to become a significant player in the rare-earth metals market, a comprehensive program is needed that covers the entire production chain—from ore mining and processing to the production of finished goods. It is important not only to modernize existing facilities and launch new projects, but also to invest in technologies for extracting specific metals and to foster sustained demand from Russian industrial companies,” noted Antonina Levashenko.
Among the priority tasks are increasing the productivity of the Lovozersky Mining and Processing Plant, developing projects at the Zashikhinsky and Tomtorsky deposits, and supporting scientific research in the field of rare earth metal enrichment and separation. Supporting enterprises that use these metals in their finished products will help establish a domestic market and make investments in the industry economically viable.