Editor’s Note
This report details the recent occupation by the Kachin Independence Army of a key rare earth mining region in Myanmar, a major global supplier. The situation poses a significant risk of supply chain disruption for critical minerals used in electric vehicles and advanced electronics, with potential implications for international markets.
[THE GURU = Reporter Jin Yujin] The possibility of disruptions in the global rare earth supply chain is increasing as Myanmar rebels have seized major rare earth mining areas. With the Myanmar military regime on the defensive due to offensives by pro-democracy forces and ethnic armed groups, analysts suggest that a halt in rare earth supplies from Myanmar could lead to price increases.
The Kachin Independence Army (KIA) stated in an interview with Reuters on the 22nd (local time), “Following the seizure of the Chi We village in Kachin State, a major rare earth mining area in Myanmar, we also took control of the Pan Wa village from the militia group NDA-K on the 19th.”
KIA said, avoiding answering questions about potential cooperation with China on rare earths. The KIA is one of the ethnic armed groups that has been fighting against the Myanmar military regime since 2021.
Rare earth mining in Myanmar is primarily concentrated in the Chi We and Pan Wa village areas of Kachin State, adjacent to China’s southwestern Yunnan Province. This region is active in gemstone and rare earth mining and is located on a major trade route connecting Kachin State’s capital, Myitkyina, to northern China. Previously, it was under the control of the NDA-K, which had allied with the Myanmar military regime and cooperated with Chinese companies seeking to establish mines.
Adamas Intelligence, a Canadian rare earth and battery metals research consulting firm, projected on the 22nd (local time) that “if rebels occupy Myanmar’s mining regions, shipments of rare earth concentrate to China—which had already decreased over the past four months due to the monsoon season and other issues—could potentially halt.”
Adamas Intelligence warned. It particularly noted, “Myanmar’s increased production and low prices have allowed automakers to overlook criticism of rare earth mining despite environmental destruction and social turmoil,” adding, “If shipments of rare earth concentrate from Myanmar to China stop, Chinese rare earth and magnet importers will pay a heavy price as they fail to secure alternative sources.”
Rare earths refer to 17 scarce elements essential for high-tech equipment. They are used not only in batteries, smartphones containing semiconductors and permanent magnets, but also in advanced weapons like the F-35 fighter jet and Tomahawk missiles.
Previously, Chinese rare earth prices hit a 16-month high last September ahead of China’s National Day holiday, as some mines in Myanmar temporarily halted operations. Myanmar was the world’s fourth-largest rare earth producer last year, and China, the world’s largest producer and importer, imports rare earths from Myanmar.
Meanwhile, the Myanmar military regime has called for participation in peace talks, but pro-democracy forces and major ethnic armed groups have rejected the dialogue proposal.
