Rare earth mining in Burma and its impact on the global economy – Thailand

---

Mining of rare earth elements (REEs) in Burma, especially Kachin State, is a major geopolitical issue at present because it is the world's largest source of heavy REEs and is mainly involved by China. Politics and security in this area are complex. After the coup, Burma has been in a state of intense conflict, with ethnic armed groups (e.g. Karen Liberation Army, Wa State, KIA) controlling some mining areas, such as Pangwa and Jibwe, which were previously under the influence of ethnic minorities supporting the state army. The Kachin rebels' (KIA) takeover of these areas in 2024–2025 has significantly reduced the flow of rare earths into the world market and provided a political bargaining chip with China, which supports the Burmese military government.

Rare Earth Mining Trends in Burma and China's Role

1) Geographic Highlights and Mine Control: Burma’s main rare earth deposits are located in Kachin State (Pangwa-Jibwe Division), close to China. The Kachin Liberation Army (KIA) seized Pangwa in Oct 2024 and controlled the mines in the area, while other armed groups (NDA-K, Wa State Army) also controlled some mines. At the time, Burma was the world’s largest exporter of Heavy REEs, exporting ~50,000 tons of Rare Earth oxides to China in 2023, exceeding China’s domestic production (19,000 tons). Satellite imagery from international research organizations indicates that new mines and mineral transport roads are expanding rapidly in Kachin.

2) The role of China and other buyers: China plays a key role in the rare earth supply chain, both in terms of investment and mineral processing. China controls over 90% of the world's rare earth production capacity and has been investing in Myanmar's mines since before 2018. The latest data shows that China's heavy REE imports from Myanmar surged to 41,700 tons in 2023 (almost double the 2021 figures), which has made Myanmar a major source of these rare earths. India is also reportedly interested in exploring rare earth deposits in Kachin State.

3) Production Process and Environmental Impact: Rare earth mining typically involves in-situ leaching of acid to extract the rare earths through acid waste ponds and releasing the wastewater into natural waterways. This process is highly polluting to soil, water and local ecosystems. For example, the use of acid to extract ore has polluted Kachin State and nearby waterways, affecting communities (rashes, respiratory problems).

Impact on the global economy and supply chain markets

1) Accumulated demand from technology industries: Rare earths are important ingredients in high-tech industries, including electronics (smartphones, 5G antennas), electric vehicles (motors using magnets mixed with Neodymium, Dysprosium, etc.), and clean energy machinery (wind turbines, electric motors). For example, research has found that “the use of heavy REEs from Myanmar in EV motors of many leading Western companies is inevitable”. In the past two years, the world has been rapidly investing in EVs and clean energy, resulting in a continuous increase in the demand for Rare Earths (international projects indicate that EVs currently have the highest rate of Rare Earth consumption in the global market).

2) Price and supply volatility: The rebel occupation of a mine in Myanmar has accelerated uncertainty in global markets. A sharp decline in mineral exports from Myanmar has driven up prices for many heavy rare earths, such as terbium oxide (one of the ingredients in magnets), which is up 21.9% from late 2024 to early 2025. The impact has extended to the magnet and high-tech industries, which are largely reliant on manufacturing in China (around 92% of permanent magnets are manufactured in China).

3) Geopolitical response: This factor has led many countries to accelerate their plans to strengthen the security of Rare Earth supply, such as the United States and the EU, which are pushing for new source search projects and ending their dependence on a single source (derisking). The EU announced that it is looking for important sources of raw materials in ASEAN (including Malaysian and Vietnamese minerals) to spread risks and reduce dependence on China. At the same time, China has measures to control the export of some types of Rare Earth as a trade pressure, such as increasing the use of Rare Earth as a geopolitical tool, as in 2010 when it stopped exporting to Japan.

Impact on Thailand

1) Technology industry and reliance on import sources: Thailand uses Rare Earth in the electric vehicle industry (as an EV production base in ASEAN), electronics, and communication equipment. Although Thailand has some Rare Earth production (as a by-product of tin-wolfram mines), its share of global production is still very low (approximately 0.84% in 2019). In other words, Thailand cannot rely on domestic production sources much, so it has to import some Rare Earth from abroad, such as China or other ASEAN countries. Changes in prices and uncertainty in the world market therefore indirectly affect the prices of Thai high-tech products, such as the cost of producing electromagnets in EV motors and electronic components. (See the summary table of Rare Earth production shares of some countries.)

2) Environmental and water resource security: Rare Earth mining near the headwaters of the Kok River in Burma poses a risk of heavy metal and toxic contamination into Thailand's major rivers, such as the Kok River that flows through Mae Ai-Chiang Rai, into tap water, agriculture, and the Mekong River. Environmental groups warn that arsenic has been detected in the Kok River, which may come from Burma's acid mine activities. In addition, unregulated mining processes have negatively impacted the lives of border communities on the Thai side, such as the lack of abundant fish in water sources that receive water from Burma.

3) Border security and ground politics: Most rare earth mines are located in ethnic minority areas that the Burmese government does not fully control, such as under the United Wa State Army (UWSA) or the KIA. Any operation is therefore complicated and requires coordination with these armed groups, making it easier for Thailand to face risks from side conflicts (e.g., migrant worker shortages, black market for weapons). In addition, Thailand must monitor the policies of large countries such as China that are expanding their investment influence in Burma, because this may indirectly tie up the Thai economy. For example, if China hoards rare earth minerals as a tool for economic pressure, it may affect the expropriation of raw materials in Thailand's supply chain.

Opportunities and challenges from other countries' foreign policies

1) China: China currently dominates the global rare earth production chain, and its domestic policies may indirectly affect Rare Earth exports to Thailand. For example, if China expands its Rare Earth export quota or uses trade barriers, Thailand, as a user, may face the risk of raw material shortages.

2) The United States and its allies (EU, Japan): have policies to promote diversification of raw material sources and invest in new supply chains, such as the Critical Minerals and Global Gateway projects. Cooperation between these countries opens up opportunities for Thailand to collaborate with countries that want to reduce its dependence on China, such as establishing clean technology partnerships (investing in mineral separation plants in ASEAN) or trade agreements that include supply chain conditions.

3) India and ASEAN: India has strengthened cooperation with Japan and Australia to develop their own Rare Earth resources, including deep-sea exploration, which will open up new supply channels that Thailand can explore. ASEAN's expanded role in the global supply chain could help Thailand find Rare Earth resources closer to home, such as Vietnam and Malaysia (which have Light/Heavy Rare Earth resources).

Thailand's policy guidelines and measures

Thailand should adjust its strategy to respond to this situation with the following main approaches:

1) Establish Rare Earth as a Strategic Resource: Establish Rare Earth as a national mineral, leading to the development of national strategies such as the announcement of the Critical Minerals list, the reservation of important raw materials (Strategic stockpiles) according to the guidelines recommended by the IEA. Consideration may be given to establishing a fund or a joint government and private sector project to reserve some types of Rare Earth to reduce the impact from price fluctuations.

2) Promote recycling and alternative technologies: Develop technologies to separate minerals from waste (e-waste, production processes) to supplement domestic sources. A concrete example is the Department of Primary Industries and Mines, which has developed technologies to recycle rare earth minerals from e-waste (e.g. extracting neodomium from old magnets). Supporting research agencies, such as universities and science institutes, to further develop these technologies will help reduce reliance on imports.

3) Diversification of sources of supply: Expand cooperation with international partners to procure rare earth raw materials, such as joining clean raw material supply chain projects (e.g. EU Global Gateway, Quad Critical Minerals), promoting Thai entrepreneurs to invest in mineral production/processing projects in ASEAN (Vietnam, Malaysia, Indonesia). ASEAN platforms (e.g. ASEAN Minerals Cooperation) should be used to coordinate agreements on raw material resources with neighboring countries.

4) Monitor and protect the environment: Accelerate water quality measurement in the Thai-Burmese border areas and establish pollution prevention lines (toxic filtering) in important rivers. Create a mechanism to coordinate with international environmental organizations such as International Rivers to monitor Burma's mining and disclose toxicity data from satellites to the public. If necessary, hold diplomatic negotiations through ASEAN or the United Nations mechanisms, calling on the Burmese government to stop mining that poses a risk to Thailand.

5) Develop internal capabilities: The government should promote research and development in alternative Rare Earth materials in the industry (e.g. ferrite magnets in EV motors) so that it does not always rely on Rare Earth. In addition, it should supervise Thai entrepreneurs to do Due Diligence on their own Rare Earth supply chain to reduce the purchase of minerals from illegal sources or those that have environmental impacts.

6) Create awareness and network: Organize academic conferences or discussion forums with business and academics (even in English or Thai) to exchange information on Rare Earth management approaches. Also, educate the public on the benefits and risks of Rare Earths so they can act appropriately and prepare for industry changes.

By taking the above measures seriously, the Thai government will help enhance the security of raw materials for modern technologies and reduce the impact of changes in the global supply chain in the long run.

By Naritsakorn Panyasunthon, Green Tree Foundation

---

bibliography

1. Global Witness. (2023). Heavy Rare Earths and Heavy Consequences: How China's Exploitation of Myanmar's Rare Earth Resources is Devastating Local Communities and the Environment. https://www.globalwitness.org

2. Myanmar Witness. (2024). Rare Earth Mining in Kachin State: Environmental and Human Security Impacts. Open-source investigative report. https://www.myanmarwitness.org

3. Reuters. (2024). “China's rare earth imports from Myanmar slump as conflict shuts mines.” https://www.reuters.com

4. Irrawaddy. (2024). “Kachin Rebels Seize Rare Earth Town, Disrupting Supply to China.”https://www.irrawaddy.com

5. United States Geological Survey (USGS). (2019). Mineral Commodity Summaries: Rare Earths. * https://pubs.usgs.gov/periodicals/mcs2020/mcs2020-rare-earths.pdf

6. International Energy Agency (IEA). (2022). The Role of Critical Minerals in Clean Energy Transitions. * https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions

7. European Commission. (2023). Critical Raw Materials Act and Strategic Partnerships. * https://ec.europa.eu

8. GIZ & ERIA. (2022). ASEAN Mineral Cooperation and Supply Chain Resilience in the Age of Decoupling.

9. Department of Primary Industries and Mining. (2022). Report on production trends and rare earth mineral policies in Thailand. Bangkok: Ministry of Industry.

10. Chulalongkorn University Energy Policy Study Center (CEP). (2021). Key raw materials for the clean energy industry: risks and strategies. Bangkok: Chulalongkorn University.

11. Earth Rights International. (2024). Toxic Trade: Rare Earth Mining and Water Pollution in the Salween and Kok River Basin. * https://earthrights.org

12. Bioeconomy Development Office (BEDO). (2023). Rare minerals in Thailand and their role in the green economy. Learning publication.

13. BBC Thai. (2025). Green economy and the control of rare resources in Southeast Asia. * https://www.bbc.com/thai