Weekly News Review December 15 – December 21 2025

The EU is softening its planned phase-out of combustion engines, sending important signals for automakers and platinum group metals markets. At the same time, the United States is advancing state-backed projects to secure raw materials.

With this issue, we want to thank you for your continued interest, trust, and engagement throughout the year. We wish you a restful holiday season and a successful start to the year ahead. The newsletter will pause for two weeks and resume its regular schedule in January.

USA: NEW STATE-BACKED RARE EARTH JOINT VENTURE:

Korea Zinc to build a smelter in the United States.

Korea Zinc plans to build a new smelting facility in Tennessee in cooperation with the U.S. Department of Defense and the Department of Commerce. The plant is set to produce base metals, including zinc, lead, and copper, as well as gold and silver. It is also intended to extract strategically important raw materials, including antimony, indium, bismuth, tellurium, gallium, germanium, and others. The facility could begin operations as early as 2029.

According to Reuters, under the terms of the agreement, the U.S. Department of Defense will hold a 40 percent stake in the planned joint venture, while Korea Zinc will own approximately 10 percent. Total investment is expected to amount to USD 7.4 billion and to create around 750 jobs.

The South Korean group has also announced its intention, subject to certain conditions, to acquire Nyrstar’s U.S. operations. Nyrstar’s smelter in Clarksdale, Tennessee, would then serve as the site for the new facility.

Ten of the thirteen products to be manufactured at the new plant are classified by the United States as critical materials. The country is seeking to significantly reduce its dependence on China, the dominant global supplier of many raw materials. Increasingly, the U.S. government itself is becoming a driving force in this effort through direct investments in companies, such as rare earths producer MP Materials.

SOUTH KOREA MULLS RARE EARTH MAGNET PLANT IN THE UNITED STATES:

South Korean industrial corporation LS Cable & Systems (LS C&S) is considering building a rare earth permanent magnet manufacturing plant in the United States. The company announced on Monday that it has selected a new investment candidate site in Chesapeake, Virginia, and is currently reviewing the project and its feasibility. LS C&S is one of the world’s largest cable manufacturers and produces a wide range of industrial materials. In its press statement, the company said the proposed facility would target major automotive manufacturers and electronic equipment producers, supplying permanent magnets used in electric vehicle drivetrains, for example.

One of LS C&S’s subsidiaries, LS GreenLink, is currently constructing a submarine cable manufacturing facility near the proposed magnet plant site, potentially enabling shared infrastructure and logistics.

The prospective U.S. plant would also build on LS C&S’s broader push into the rare earth magnet market. In 2024, the company entered into a joint venture framework with German permanent magnet maker Vacuumschmelze (VAC) to support large-scale production of neodymium-based magnets. Through its materials subsidiaries, LS C&S is working to secure upstream access to rare-earth feedstock and to establish a vertically integrated magnet supply chain spanning Asia, Europe, and North America.

EU PHASE OUT OF COMBUSTION ENGINES SOFTENED: GREATER FLEXIBILITY FOR AUTOMAKERS –

Key signal for platinum group metals.

As part of the automotive policy package presented on Tuesday, the European Union is easing the planned 2035 ban on the sale of internal combustion engine (ICE) vehicles. While the overarching target of a 100 percent reduction in emissions remains formally in place, this reduction would no longer need to be achieved solely during vehicle operation. Instead, CO₂ emissions generated after 2035 could be offset through alternative mechanisms.

In practical terms, this means manufacturers may improve their emissions balance by using sustainably produced steel or alternative fuels, including e-fuels. Effectively, the regulation would require a 90 percent reduction in emissions, while still allowing the continued sale of conventional vehicles, as well as plug-in hybrids and range extenders.

According to the European Commission, the package continues to send a “strong market signal for zero-emission vehicles,” while also granting the automotive industry greater flexibility in meeting CO₂ targets. The proposals also include measures to strengthen Europe’s domestic battery value chain, reduce bureaucracy, and promote the production of smaller, more affordable electric vehicles.

As with all EU legislative initiatives, the proposals must still be approved by both the Council and the European Parliament.

The potential end of the ICE phase-out has been debated repeatedly in recent years. Most recently, a similar initiative emerged in March as part of an action plan to improve the competitiveness of Europe’s automotive industry. Even before the official announcement, economists had criticized the decision. Sebastian Dullien, Director of the Institute for Macroeconomics and Business Cycle Research (IMK), argued that the core challenge facing German automakers is not the combustion-engine ban itself, but rather their technological lag—particularly in battery-cell development.

Beyond the automotive sector, the EU’s decision also represents a significant market signal for platinum group metals, given that the automotive industry, especially catalytic converters, is the dominant end-use sector for palladium (accounting for 70–85 percent of demand) and rhodium (55–80 percent). Platinum, which is also heavily used in catalytic converters (approximately 30–45 percent of total demand), is expected to benefit as well.

USA: EXTRACTING RAW MATERIALS, IMPROVING WATER QUALITY: RARE EARTHS FROM MOUNTAIN STREAMS –

A U.S. research project aims to extract critical raw materials from contaminated waters in Colorado, while simultaneously enhancing environmental protection.

Rare earth elements are essential inputs for a wide range of modern technologies. However, rapidly growing demand is increasingly colliding with limited availability. Researchers around the world are therefore exploring alternative sources and extraction methods, including algae, bacteria, proteins, and even discarded lamps.

Mountain streams in the United States, particularly in Colorado, could soon provide a more independent supply of these strategic resources. Along the so-called Mineral Belt, acidic waterways leach metals from the surrounding bedrock. In some cases, this contamination can be traced back to abandoned mining sites; in others, it results from natural geochemical processes. Climate change is further intensifying these effects.

Years of research led by the University of Colorado (CU) have focused on studying this phenomenon. In the process, researchers report that they “accidentally” discovered unusually high concentrations of rare earth elements in the affected waters.

U.S. Government Supports Rare Earth Extraction From Polluted Mountain Streams:

A new project, funded by the U.S. Department of Energy with USD 2.8 million, now aims to develop a method for recovering these resources. The planned approach involves molecular-level extraction using ion-imprinted polymers made from byproducts of seafood processing. According to the researchers, these polymers function like puzzle pieces: they selectively bind rare earth elements, while other molecules do not interact with them and can be filtered out of the water.

Artificial intelligence will be used to further enhance the material’s selectivity and improve the separation of individual rare earth elements. At the same time, potential sites for future extraction are being identified.

Beyond unlocking new sources of raw materials, the proposed process is expected to improve water quality and reduce the risks posed by metal contamination to ecosystems and regional water supplies. Such remediation measures are typically extremely costly, explains Diane McKnight, Professor of Environmental and Water Research at CU. Recovering a valuable resource in parallel, she notes, fundamentally changes the economic equation.