In our last edition, Together We Build: Reindustrialization of America, we explored how historical industrial policies can inform a modern investing methodology in the face of shifting global dynamics. As a reminder, we categorized raw materials into three investment-relevant groups:
- Strategic Materials – Rare Earth Elements (REEs), Semiconductors, and Lithium
Vital for national defense and advanced technologies, yet heavily reliant on foreign supply chains. - Critical Materials – Cobalt, Graphite, and Aluminum
Essential for energy storage and transportation, with vulnerable domestic sourcing. - Essential Materials – Steel, Copper, and Cement
The foundational components of industrial infrastructure.
Spotlight on Strategic Materials: Rare Earth Elements & Lithium
This article zeroes in on two highly strategic materials: Rare Earth Elements (REEs) and Lithium. Both are integral to a wide array of technologies, ranging from electric vehicles (EVs) and renewable energy systems to defense equipment and medical devices.
Research suggests rare earth elements (REEs) demand is led by magnets (~33% in 2025), used in automotive, renewable energy, and electronics, with a projected growth rate of 10-12% CAGR by 2032. For example, the rare earth neodymium highlighted in the periodic table above is used to produce magnets used in various everyday applications in audio equipment, mobile phones, and disk drives, and is vital in wind turbine assemblies. Similarly, lithium demand is dominated by electric vehicles (EVs) at ~38% in 2025, with key sectors including energy storage and consumer electronics, growing at ~18.9% CAGR by 2032.
The U.S. Department of Energy (DOE), in its April 2020 report Critical Materials Rare Earths Supply Chain, identified 17 elements as “rare earths.” These elements are now center stage in national security discourse, as highlighted in a series of recent Executive Orders aiming to revitalize domestic mining and refining capacity.
A Strategic Vulnerability
Currently, China controls over 90% of global rare earth refining and over 60% of global rare earth mining. This dominance poses a significant strategic risk, leading the U.S. to pursue vertical integration of domestic supply chains for critical minerals.
📄 Executive Order: Ensuring National Security and Economic Resilience
Investing in the Future: ETF vs. Direct Exposure
Initially, we considered the VanEck Rare Earth and Strategic Metals ETF (REMX), which offers broad exposure to companies involved in strategic minerals. Its geographic spread is diverse—about 18% U.S. and 10% China. However, in light of the geopolitical landscape, we opted to dig deeper into the individual holdings to identify U.S. and allied “national champions.”
Here are four companies that stand out:
US Rare Earth Elements
MP Materials (Ticker: MP)
- Location: Mountain Pass, California
- Focus: Only active U.S. rare earth mining and processing site
- Use Case: EVs, wind turbines, defense
- Strategic Edge: Central to U.S. policy goals; competes with Chinese dominance
- Website
Lynas Rare Earths (Ticker: LYSDY)
- Location: Australia (mining), Malaysia (processing)
- Focus: Rare earth oxides for permanent magnets
- Use Case: EVs, electronics
- Strategic Edge: Non-Chinese alternative, government-backed supply chain diversification
- Website
⚡ Lithium
Albemarle Corporation (Ticker: ALB)
- Location: U.S. HQ with global operations (Chile, Australia, U.S.)
- Focus: Lithium, bromine, and specialty chemicals
- Use Case: EV batteries, grid storage
- Strategic Edge: Integrated operations, policy-aligned U.S. producer
- Website
Sociedad Química y Minera (Ticker: SQM)
- Location: Chile
- Focus: Fertilizers, iodine, and lithium
- Use Case: EV batteries
- Strategic Edge: Vast lithium reserves, low-cost production
- Website
Looking Ahead
As the U.S. government intensifies efforts to secure critical mineral supply chains, investors have an opportunity to align with long-term structural trends. Companies like MP Materials and Albemarle stand to benefit from federal support and shifting global sourcing patterns, while allies like Lynas and SQM offer diversified, non-Chinese exposure.
Servant Financial’s investment research is ongoing on these materials vital for America’s industrial resurgence. Our intention is to develop a thematic internal fund, or basket of securities, comprised of competitively well-positioned companies with the most attractive risk-adjusted return potential. Our next newsletter issue will cover critical materials, followed by essential materials, and wrap up with disclosure of the composition of our Strategic Materials Fund.
📄 Executive Order: Unleashing America’s Offshore Critical Minerals
📄 Executive Order: Measures to Increase Domestic Mineral Production
