Feedstock sovereignty in Europe and the US

The French government is helping to finance two new rare-earth plants in France. Half the investors in the one that makes oxides are Japanese, and they arrived with an offtake agreement that sends half its output to Japan. A US company has taken a large stake in the plant that makes the metal, with rights to buy. Iris ten Have of Visionaries Tomorrow told the story to show what Europe is missing. Europe shows up with targets, Iris said, and Japan and the US show up with contracts. "We can build, but apparently, we can't buy."

Stockpiles or plants

Ten Iris had opened the session, co-hosted with Danielle Joseph of Closed Loop Partners, with the numbers for magnets. China controls about 60% of rare-earth mining, 91% of refining and separation and 94% of finished magnets. The figures have been known for a decade but only began to hurt when China started licensing exports. The US has a fund of about $12bn, Project Vault, for stockpiling, and Europe has about €3bn for projects and stockpiles together.

Asked how they would spend a billion, participants split. One wanted to stockpile while Europe works through permits, because Europeans want electric cars but not lithium mines. A magnet maker said stockpiling could only be a short-term fix. Magnets come in too many geometries, grades and applications to store, and only producing them lets a country improve its processes. The West is about eight years behind China in that know-how, they said. Price is the harder problem. European oxide costs too much to justify turning it into metal and magnets against China's integrated, large-scale industry, and without a floor price, which only a government can set, competing is impossible.

The US defence department has given MP Materials a floor price of $110 per kilogram for NdPr. Ten Iris knew of no European buyer willing to set a floor price for ten years, a commitment that in the host's view de-risks an asset completely.

We can build, but apparently, we can't buy.

Learning to build again

A founder in chemical recycling doubted that either stockpiles or floor prices would get Europe out of trouble after 20 comfortable years of cheap Chinese prices. The answer, the founder said, is cheap local feedstock such as mixed plastic waste, processes that use little energy, and learning to build again. China puts up a massive facility every six months. When Europe builds one, it costs 300% more and takes five years longer.

One of the hosts said Europe exports about two-thirds of some feedstocks it does have, such as plastic waste and battery black mass, to Asia because it cannot process them economically. A participant from the battery industry expected such material to find ways round an export ban that starts on 9 December. What matters, they said, is how many steps, from cathode materials to cells and packs, Europe owns before it leaves.

Money in the wrong packages

An investor who has backed six critical-minerals start-ups said Northvolt had come up again and again over the previous 24 hours, calling it "the multi-billion Euro shining hood ornament on the vehicle of circularity." Investment committees are gun-shy, and even small modular plants, once past the demonstration stage, fall below infrastructure financiers' minimum ticket sizes. The money, the investor said, is not in the right packages. A host said project financiers show little interest below 100 million, and the only credible option the host had seen for plants of 20 to 100 million was repurposed trade finance.

Danielle has both kinds of capital to hand. At the pre-seed and seed stages, Danielle backs only small, distributed plants. Another part of Closed Loop Partners has raised over $700m for a holding company that buys large recycling assets across the US and is EBITDA positive. Which model fits depends on the value of the material, the plant's economics and whether there is enough feedstock within a 200-mile radius.

Government as first buyer

A founder in direct air capture wanted governments treated as customers for essential feedstocks. A UK trade deal with the US last year made imported bioethanol cheap and killed the economics of the UK's two major bioethanol plants. One closed straight away. The other is subsidised, not for its ethanol but to guarantee a quarter of the UK's CO2 supply, which is needed to cool nuclear reactors. One of the hosts said a government buyer of last resort would de-risk such assets, and the suggestion followed that it should almost be the buyer of first resort.

In the last minutes, one of the hosts asked whether the sovereignty push is a blip. All but one of those who answered expected it to last, and the exception said only the man in the White House knew. One participant pointed to politicians who promise voters significance through self-sufficiency, and another to summers when inland shipping on Europe's rivers cannot be relied on. A third said AI is coming for Europe's knowledge economy, so Europe needs physical assets it does not yet have. A host agreed that owning assets, land and resources may be the only defence left. If so, Europe will need what the French plants found only abroad, a buyer.

This Ripple was hosted by Iris ten Have (Visionaries Tomorrow) and Danielle Joseph (Closed Loop Partners) at The Drop 2026 on 16 September.