Kyiv ramps up rare earths push in return for continued US military aid

Ukraine has offered to strike a deal with US President Donald Trump for continued American military aid in exchange for developing Ukraine’s mineral industry.

Ukrainian President Volodymyr Zelensky has a new proposal for keep US military aid flowing to Ukraine. Picture: AFP

Ukraine has offered to strike a deal with US President Donald Trump for continued American military aid in exchange for developing Ukraine’s mineral industry, which could provide a valuable source of the rare earth elements essential for many kinds of technology.

Mr Trump said last week that he wanted such a deal, initially proposed last year by Ukrainian President Volodymyr Zelensky as part of his plan to strengthen Kyiv’s hand in future negotiations with Moscow.

“We really have this big potential in the territory which we control,” Mr Zelensky’s chief of staff, Andrii Yermak, said.

“We are interested to work, to develop, with our partners, first of all, with the United States.”

Rare earth elements are a set of 17 elements essential to much consumer technology, including mobile phones, hard drives and electric and hybrid vehicles.

It is unclear if Mr Trump is seeking specific elements in Ukraine, which also has other minerals to offer.

“It can be lithium. It can be titanium, uranium, many others,” Mr Yermak said. “It’s a lot.”

China is the world’s largest producer of rare earth elements and the US and Europe have sought to reduce their dependence on Beijing.

For Ukraine, such a deal would ensure its biggest and most consequential ally does not freeze military support. That would be deva-stating for the country, which has been at war since Russia’s invasion on February 24, 2022.

The idea also comes at a time when reliable and uninterrupted access to critical minerals is increasingly hard to come by globally.

Ukraine’s rare earth elements are largely untapped because of the war and state policies regulating the mineral industry.

The country also lacks good information to guide the development of rare earth mining.

The industry’s true potential is clouded by insufficient research, according to businessmen and analysts.

In general, the outlook for Ukrainian natural resources is promising. The country’s reserves of titanium, a key component for the aerospace, medical and automotive industries, are believed to be among Europe’s largest.

Ukraine also holds some of Europe’s largest known reserves of lithium, which is required to produce batteries, ceramics and glass.

In 2021, the Ukrainian mineral industry accounted for 6.1 per cent of the country’s gross domestic product and 30 per cent of exports.

An estimated 40 per cent of Ukraine’s metallic mineral resources are inaccessible because of Russian occupation, according to data from We Build Ukraine, a Kyiv-based think tank.

Ukraine has argued that it is in Mr Trump’s interest to develop the remainder before Russian advances capture more.

Details of any deal will likely develop in meetings between US and Ukrainian officials.

US companies have expressed interest, according to Ukrainian business officials. But striking a formal deal would likely require legislation, geological surveys and negotiation of specific terms.