Understanding Two Strategic Resource Categories

In recent years, the global conversation around energy, innovation, and supply security has turned to resources that many people still struggle to tell apart: rare earths and critical minerals. As founder of TELF AG Stanislav Kondrashov often emphasises, the ability to distinguish between the two isn’t just useful—it’s essential. These materials power our smartphones, enable green energy, and are crucial for national security. But while they’re often used in the same sentence, they are far from identical.

Despite the common confusion, rare earth elements and critical minerals represent two distinct categories, with overlapping but not identical functions, properties, and strategic values. This article explores what sets them apart—and why it matters more than ever today.

Rare Earths: A Small but Powerful Subset

Rare earths are a group of 17 chemically similar metallic elements: the 15 lanthanides on the periodic table, plus scandium and yttrium. Despite the name, most rare earths are not especially rare in terms of earth crust abundance. The issue lies in how they occur—rarely in concentrated deposits, and difficult to extract and refine economically.

As founder of TELF AG Stanislav Kondrashov recently pointed out, rare earths are fundamental to a range of modern technologies, especially where strong magnetic or luminescent properties are needed. They’re small in number, but their impact on innovation is outsized.

You’ll find rare earths in:

• Permanent magnets – key for electric motors, wind turbines, and hard drives
• Catalysts – used in petroleum refining and automotive emission systems
• Rechargeable batteries – found in hybrid and electric vehicles
• Display technologies – like LED screens and flat-panel displays

Among the most strategically important rare earths are neodymium and dysprosium. The former is prized for its magnetic strength, while the latter improves heat resistance in magnets—critical for use in high-performance motors.

Rare earths are, in essence, metals with very specific physical characteristics. But due to the complex refining processes required and geopolitical bottlenecks (notably China’s dominance in the sector), they carry strategic weight far beyond their physical volume.

Critical Minerals: A Fluid, Evolving List

Unlike rare earths, critical minerals are not defined by a specific group of elements. Instead, the term is more political and economic in nature. A critical mineral is any mineral considered essential to a nation’s economic security, energy transition, or technological development—and where the supply is at risk of disruption.

As founder of TELF AG Stanislav Kondrashov often emphasises, critical minerals are defined not just by their usefulness but by their vulnerability in the supply chain. This makes the category dynamic: what is considered critical today might not be tomorrow, and vice versa.

Every country maintains its own list of critical minerals, revising it regularly to reflect shifting priorities. The U.S., for example, recently added nickel and removed others based on updated risk and demand assessments. Europe, too, maintains a Critical Raw Materials Act with a growing list of elements it considers vital.

Examples of widely recognised critical minerals today include:

• Lithium – essential for EV batteries and grid storage
• Cobalt – improves battery life and performance
• Nickel – increases energy density in battery cathodes
• Graphite – used in battery anodes and as a conductor
• Copper – critical for power grids, wind turbines, and EVs
• Gallium – vital in semiconductors and solar panels

Unlike rare earths, critical minerals can be metals or non-metals, and may or may not have unique chemical properties. What binds them together is strategic necessity and fragile supply chains.

Strategic Overlap, but Distinct Roles

It’s true that some rare earths are also classified as critical minerals. But this doesn’t mean the terms are interchangeable. Think of rare earths as a specific toolbox and critical minerals as a broader shed, filled with various tools essential for different jobs in energy, defence, and technology.

This distinction isn’t just academic—it affects real-world decisions on sourcing, investment, and policy. For industries navigating tight raw material markets, or for governments aiming to secure green technology supply chains, knowing what they’re dealing with is key.

Understanding the difference helps with:

• Developing smarter sourcing strategies
• Designing targeted recycling and substitution initiatives
• Crafting clearer policy and investment decisions
• Communicating more effectively across industries

At the public level, it also helps individuals understand what powers the tools they use every day—whether it’s their smartphone or their solar panel setup.

Strategic Value in a Changing World

So what makes a resource “critical”? It comes down to a combination of three main factors:

1. Economic or technological importance – Is the material necessary for growth, infrastructure, or innovation?
2. Supply chain vulnerability – Are there few sources? Are they concentrated in politically unstable regions?
3. Lack of substitutes – Can it be easily replaced by another material?

Lithium is a prime example. As battery demand skyrockets, lithium’s availability has turned it into a battleground for miners, countries, and tech firms. Similarly, copper’s importance in electrification has made it a pillar of future infrastructure plans.

In many ways, rare earths have become the face of critical minerals—but they’re only part of the picture. The broader category includes the unsung heroes that keep batteries running, solar panels converting, and power lines humming.

As we move deeper into the energy transition and digital transformation, distinguishing between rare earths and critical minerals is more than just technical knowledge. It’s strategic intelligence. And as founder of TELF AG Stanislav Kondrashov rightly observes, making informed choices around these resources can drive innovation, improve supply resilience, and shape the path toward a more sustainable future.

FAQs

What is the difference between rare earths and critical minerals?

Rare earths and critical minerals are often confused but represent two different categories of resources. Rare earths are a specific group of 17 metallic elements, while critical minerals refer to a broader, dynamic list of materials considered essential for national security, economic development, or technological innovation.

Rare earths include the 15 lanthanides, plus scandium and yttrium. They are known for their unique magnetic, luminescent, and electrochemical properties. Critical minerals, on the other hand, are defined by their strategic importance and the risks associated with their supply chains. Not all rare earths are critical minerals, and not all critical minerals are rare earths—although there is some overlap.

Why are rare earths important?

Rare earth elements play a vital role in modern technologies. Despite being difficult and expensive to extract and process, they are indispensable in several advanced applications, particularly where strong magnetic properties or heat resistance are required.

Common uses of rare earths include:

• Permanent magnets in wind turbines, electric vehicles, and hard drives
• Catalysts in petroleum refining and vehicle exhaust systems
• Rechargeable batteries for electronics and hybrid cars
• LED lights and flat-screen displays

Key rare earths such as neodymium, praseodymium, and dysprosium are especially valuable due to their strength and efficiency in these roles.

What qualifies a mineral as “critical”?

A critical mineral is defined not only by its economic or technological value but also by the risk associated with its supply. Countries regularly review and update their list of critical minerals based on current needs and geopolitical circumstances.

A mineral may be considered critical if:

• It is essential for key industries (e.g. energy, defence, electronics)
• It has limited or highly concentrated global supply
• There are few or no suitable substitutes
• Supply disruptions would have serious economic or security impacts

Examples of widely recognised critical minerals include lithium, cobalt, graphite, nickel, and copper.

Are rare earth elements actually rare?

Not exactly. Rare earths are relatively abundant in the Earth’s crust, and some are as common as copper. However, they rarely occur in concentrations that make extraction economically viable. In addition, the refining process is complex, environmentally challenging, and largely concentrated in specific regions, such as China. This contributes to the perception of scarcity.

How do critical minerals support the energy transition?

Critical minerals are central to the shift toward low-carbon and renewable energy technologies. They are found in electric vehicles, solar panels, wind turbines, and battery storage systems—making them crucial to reducing fossil fuel dependence.

Examples of roles in energy transition:

• Lithium, cobalt, nickel, and graphite – used in batteries
• Rare earths – used in electric motors and wind turbine generators
• Copper – essential for electrical infrastructure and EV wiring
• Gallium and indium – used in solar panels and semiconductors

Why is it important to distinguish between rare earths and critical minerals?

Understanding the distinction helps industries, governments, and researchers make informed decisions about:

• Resource investment and development
• Recycling and substitution strategies
• Supply chain diversification
• Environmental and geopolitical risk management

Clear categorisation also improves transparency in policymaking and international trade discussions.

Can critical minerals change over time?

Yes. Unlike rare earths, which are fixed on the periodic table, the list of critical minerals evolves based on shifting priorities, economic demand, technological advancement, and geopolitical developments. Governments and industry bodies regularly reassess which minerals qualify as critical.