Article in the Dutch journal Volkskrant published 2025 02 25 with Magnus Ericsson on rare earths in Ukraine.
Translated from Dutch.
Trump is eyeing Ukraine's rare earth metals, but isn't he counting his chicken before they hatch?
According to President Donald Trump, a raw materials deal with Ukraine is imminent. The US wants 500 billion dollars in Ukrainian mineral resources in exchange for military support. But according to geologists, this amount is 'completely plucked out of thin air'.
What is the mineral deal about?
Quid pro quo: Ukrainian rare earth metals in exchange for military support. Ukrainian President Volodymyr Zelensky already suggested this exchange in his 'victory plan' last autumn. He hoped to keep Donald Trump, who as a presidential candidate already openly hinted at withdrawing support for Ukraine, on board.
In early February, Washington put forward a concrete proposal that, according to American media, did not deviate much from the current text. Because it did not contain American military aid against the attacks by Russia, Zelensky rejected it. The negotiations did continue.
A second version of the proposal, seen by The New York Times, discusses a structure in which 50 percent of the future revenues from all mined raw materials would go to the US, as repayment for the military support. This would not only concern the revenues from rare earth metals, but also from oil and gas. The total price tag: 500 billion dollars.
On Monday evening, Trump said that Zelensky would sign the deal this week or next. That same day, the Kremlin dangled a carrot in front of the American leader by stating that Russia has many more rare earth metals at its disposal, to which it potentially wants to give the US access.
What metals can Ukraine offer the US?
On paper, Ukrainian soil is rich in a range of important raw materials. These include so-called rare earth metals, a group of seventeen elements, some of which are crucial for both the energy transition and military weapons. For example, neodymium, needed to make the extremely strong magnets in wind turbines, electric cars and the Joint Strike Fighter. Other kinds of metals, such as lithium (used in electric car batteries) and titanium (important in aerospace), are also found in the fertile Ukrainian soil.
Access to these materials is crucial now that a race has developed between China and the US. For example, China currently produces 60 percent of all rare earth metals and refines 90 percent, while the Americans (and Europeans) are extras. The US wants to compete with them.
Is an amount of 500 billion dollars realistic as a ‘quid pro quo’?
Ukrainian Deputy Prime Minister Yulia Svyrydenko stated on Sunday that there are at least 350 billion dollars worth of raw materials in Russian-occupied soil. This mainly concerns materials in the eastern region of Donetsk, which has been almost entirely in the hands of pro-Russian separatists since 2014, The Kyiv Independent reported.
The newspaper immediately noted that this was a rough estimate and that it is far from clear exactly how many billions are in the soil. For that reason, Ukrainian geologist Boris Malyuk calls the $500 billion Trump previously mentioned “bullshit.” Malyuk, who works for the French Bureau de Recherches Géologiques et Minières, recently published a book on Ukraine’s natural resources.
“Even in Ukraine, we don’t know exactly how many rare earths our soil contains,” he says. “The estimates we have date back to the Soviet era, when rare earths were not yet as important to the global economy as they are today. So we will have to re-map all those resources.”
Magnus Ericsson, a Swedish professor of mineral economics at Luleå University of Technology, goes a step further. “The $500 billion figure is completely unfounded. First of all, it is highly questionable whether any rare earths can be mined in Ukrainian soil. Furthermore, the value of all rare earth metals produced in the world currently amounts to only about 10 to 15 billion dollars. At current prices, it would take at least 33 years to earn 500 billion dollars on a global scale alone.’
The Ukrainian government believes that the figure of 500 billion dollars is not only in geological terms, but also in military terms. Last week, Zelensky stated that US support for Ukraine amounted to less than 100 billion dollars, of which 67 billion was arms support.
‘I can't just sell my country’, he responded angrily, adding that he would saddle future generations with an enormous debt. In the most recent version of the agreement, the 500 billion has now been dropped, The New York Times wrote on Monday. This was not confirmed by the
negotiators.
How easy are Ukrainian raw materials to extract?
That could prove difficult. Ukraine has traditionally focused on agriculture and not so much on mining rare metals. Moreover, it is unclear whether the raw materials can be mined at all, concluded the Washington-based Center for Strategic and International Studies. Mining costs a lot of energy, while half of Ukraine’s energy infrastructure has been destroyed by the war.
Professor Ericsson therefore also has his doubts. ‘It is not just a question of whether there are rare earths in the ground, but also of whether they can be extracted profitably. If so, then substantial investments in mining equipment must first be made, and a licensing process must be completed. All in all, this will take about fifteen to twenty years. So before Donald Trump has his $500 billion, if the Ukrainians can even get it, he will be at least 130 years old.'