There is danger that the rare earth exports will be caught in the crossfire of rising U.S.–China tariffs war. In anticipation of the worsening conditions, the global tech and defense industries are adopting counter measures to mitgate any form of supply disruptions.
On 4 April, China imposed new restrictions on seven critical rare earth elements and magnets, requiring export licenses and delaying outbound shipments.
The move came in direct response to U.S. tariffs of up to 145 percent and has shaken markets reliant on these strategic materials. The tariffs on China have since then shot up to an astonishing 245 percent.
More than half of the United States’ supply of critical minerals currently comes from China.
Now, a domestic recycling initiative may offer a way out of this dependence by turning discarded data center hardware into a reliable, eco-friendly source of rare earths and valuable metals.
In a first-of-its-kind pilot, Western Digital, Microsoft, Critical Materials Recycling (CMR), and PedalPoint Recycling processed nearly 50,000 pounds of decommissioned hard drives and server hardware.
Using a new acid-free chemical method, the team extracted rare earth elements like Neodymium, Praseodymium, and Dysprosium, as well as high-purity gold, copper, aluminum, and steel.
The recycled materials are already feeding back into supply chains supporting electric vehicles, wind energy, and next-generation electronics.
At the heart of the process is acid-free dissolution recycling (ADR), a technology developed by the Critical Materials Innovation (CMI) Hub.
The pilot reached a 90 percent recovery rate for rare earths and base metals, along with 80 percent total material recovery by mass.
"This initiative sets a new standard for end-of-life data storage management," said Jackie Jung, vice president of Global Operations Strategy and Corporate Sustainability at Western Digital.
"This project is more than a milestone. It’s a model for sustainable progress in critical material recovery."
The process also delivers major environmental gains. According to a life cycle analysis, it reduces greenhouse gas emissions by 95 percent compared to conventional mining and refining.