National People's Congress Representative and Chinese Academy of Sciences Academician Yan Chunhua: The Rare Earth Industry Should Shift from "Resource Advantage" to "Technological Advantage"

“This year’s government work report emphasizes the implementation of a new round of high-quality development initiatives for key manufacturing industry chains. This is not only a crucial lever for promoting economic growth but also a matter of national strategic security.” National People’s Congress delegate and Chinese Academy of Sciences academician Yan Chunhua said in an interview. As a researcher who has long studied rare earths, he pointed out that the core of this strategic initiative is to transform China’s resource endowment advantages into resilient and secure industrial and supply chain advantages, driving the industry from “resource possession” to “technological control” for leapfrog development.

National People’s Congress delegate and Chinese Academy of Sciences academician Yan Chunhua (photo provided by interviewee)

Yan Chunhua stated that manufacturing is the foundation of industry and a concrete reflection of a country’s comprehensive strength. As a key material supporting emerging industries such as new energy vehicles, wind power, and industrial robots, the development path of rare earths vividly exemplifies this strategy. After decades of effort, China has achieved a leap from being a “big resource country” to a “big producer of rare earths.” Standing at a new historical starting point, the new round of initiatives aims to help the rare earth industry shed its dependence on “resource advantages” and shift toward “technological advantages,” entering a stage of deep processing that turns “raw materials into gold,” and truly achieving a leap in new quality productivity.

“However, we should not be overly optimistic, as we still face bottlenecks in high-end applications and foundational patents,” Yan Chunhua expressed concern. He pointed out that rebuilding the industrial foundation must first identify weaknesses. Currently, China has established a leading advantage in upstream processes such as rare earth mining, beneficiation, and separation, but significant gaps remain: First, in high-end applications, for example, the high-end NdFeB magnets needed for electric vehicle drive motors still lag behind top Japanese and German products in consistency and temperature resistance; second, in the layout of basic patents, Western countries and Japan have built deep “patent moats” in high-end applications, often creating intellectual property barriers for our exports; third, in the transformation of industry-university-research into practical applications, basic research results from universities and research institutes often remain in laboratories and struggle to reach industrial maturity.

Regarding solutions, Yan Chunhua suggested focusing on breakthroughs across the entire “materials-device-equipment” chain through technological research. He believes that tackling major technical equipment must target key areas and concentrate efforts on solving tough problems:

First, develop high-end rare earth permanent magnetic materials. These are the “power core” of new energy vehicles, wind power, and industrial robots, and require breakthroughs in higher magnetic energy density, coercivity, and temperature stability in new generations of permanent magnets.

Second, promote the device application of rare earth functional materials. Extend from “making materials” to “making devices,” such as developing rare earth super-magnetostrictive materials for high-power sonar and precision actuators, as well as rare earth hydrogen storage materials for hydrogen energy storage and transportation.

Third, develop intelligent preparation equipment. Focus on creating intelligent, green, complete sets of equipment to achieve integrated innovation across “materials-process-equipment,” addressing the challenges of complex preparation processes and narrow process windows for rare earth materials.

How to organize breakthroughs? Yan Chunhua recommended adopting a “new national system” approach, led by leading enterprises, in collaboration with universities and research institutes to form innovation consortia, using a “task listing and commanding” mechanism to focus on solving “bottleneck” problems. Currently, industrial clusters in Baotou, Inner Mongolia, and Ganzhou, Jiangxi, are organizing national research forces to carry out targeted, goal-oriented collaborative efforts, which exemplify this approach.

Additionally, Yan Chunhua emphasized the importance of cluster development to achieve a “dual-drive” of innovation ecology and chain-based collaboration. He believes that building a national advanced manufacturing cluster depends on two key points:

First, establishing a full-chain innovation ecosystem from “basic research” to “technological breakthroughs” to “results transformation.” For example, Ganzhou’s “China Rare Earth Gold Valley” leverages a national platform to form a science and technology innovation cluster, while Baotou relies on leading enterprises to gather technological resources—both successful explorations. Universities like Peking University and Lanzhou University also play a role by leveraging their basic research and talent advantages, actively participating in collaborations to promote the integration of basic and applied research.

Second, strengthening the leading role of “chain master” enterprises and fostering integration among large, medium, and small enterprises. Clusters are not just a simple gathering of companies but an organic aggregation of the industry chain. The role of “chain master” companies like China Rare Earth Group and Northern Rare Earth Group should be leveraged to lead and guide small and medium-sized enterprises along specialized, innovative development paths, forming a robust industrial ecosystem with both towering trees and dense undergrowth.

“This new round of high-quality development initiatives for manufacturing industry chains points the way for the rare earth industry,” Yan Chunhua concluded. “We must lead with technological innovation, transforming rare earths from ‘resource advantages’ to ‘technological advantages,’ upgrading from ‘material supply’ to ‘solution provision,’ and contributing to the building of a manufacturing powerhouse with rare earths.” (Reported by Yang Xiufeng, China Economic Net)