The United States held a second round of secret talks with Myanmar's military-backed rulers in Tokyo last week, Reuters reported. Washington has explored access to Myanmar's heavy rare earths, used in high-performance magnets, but no supply deal has been confirmed.
At a glance
- Nearly half the world's heavy rare earth supply comes from mines in Myanmar's Kachin State, Reuters reported in July.
- The Kachin Independence Army controls key mining areas near the Chinese border.
- India has also sent delegations to explore Myanmar's critical minerals.
Background
Heavy rare earths such as dysprosium and terbium are used in high-performance magnets for electric vehicles and wind turbines. Much of Myanmar's output is shipped to China for processing, and China's dominance extends to refining. Myanmar has been in civil war since the military overthrew the elected government in February 2021.
What happened
US officials met representatives of Myanmar's military-backed government in Tokyo last week, Reuters reported, citing three people familiar with the matter. It was the second round of talks in a month. The US delegation was led by Michael Vance, Assistant Secretary of State for Intelligence and Research, and included more than a dozen officials.
The meeting followed Vance's mid-September visit to Naypyitaw, where he met President Min Aung Hlaing. Those talks covered the release of an American businessman and online scam networks targeting US citizens. Washington has also explored access to Myanmar's heavy rare earths, though no minerals agreement has been confirmed.
Why Myanmar's rare earths matter
Kachin State in northern Myanmar is a major source of heavy rare earths, including dysprosium and terbium. Reuters reported in July that nearly half the world's heavy rare earth supply comes from mines in the state, with much of it shipped to China for processing.
Access is difficult. The Kachin Independence Army (KIA) controls key mining areas near the Chinese border, including the Chipwe-Pangwa belt it seized in October 2024. A 2025 Stimson Center analysis found Myanmar lacks the capacity to refine rare earths to the purity needed for advanced manufacturing.
What it means for India
India is pursuing the same resources. Indian Ambassador Abhay Thakur said in July that two Indian delegations visited Myanmar to explore critical minerals, in December 2024 and February 2026. Reuters has also reported that India's mines ministry asked state-owned IREL and private firm Midwest Advanced Materials to explore obtaining rare earth samples from KIA-controlled mines.
Our read
Outlook: neutral. The talks have produced no supply deal, and Myanmar's mines remain contested. There is no immediate effect on rare earth supply.
What to watch
- Whether US-Myanmar talks produce any agreement on rare earth supplies.
- Fighting between Myanmar's military and the KIA around the Kachin mining belt.
- Progress by IREL and Midwest Advanced Materials on obtaining Myanmar rare earth samples.
For information only, not investment advice.
Detailed analysis
Timeline
- 2026-10-16: Reuters reports a second round of secret US-Myanmar talks, held in Tokyo.
Supply Drivers
Kachin State mines supply nearly half the world's heavy rare earths, mostly processed in China.
Government Policies
The US and India are both seeking routes to heavy rare earths outside Chinese control.
Geopolitical Risks
Civil war and rebel control of key mining areas make Myanmar supply hard to secure.
What could lift prices
- Competition among the US, India and China for Myanmar's supply highlights its scarcity.
- Fighting around Kachin mining areas could disrupt output.
What could weigh on prices
- A US-Myanmar deal could eventually open a new supply route outside China.
- No agreement exists yet, so the talks change little for now.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Myanmar | High | Its rare earth deposits are drawing renewed diplomatic attention from the US and India. |
| China | Medium | It processes much of Myanmar's rare earth output. |
| India | Low | Indian firms are exploring access to Myanmar's rare earths. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Electric Vehicle Manufacturing | Neutral | EV motor makers depend on heavy rare earths, but supply is unchanged for now. |
Who gains, who loses
- Myanmar's military-backed government: Renewed US engagement gives it diplomatic attention it has long lacked.
- Chinese rare earth processors: They could face competition for Myanmar feedstock if other buyers gain access.
Other ways this could play out
- If the talks lead to a minerals deal, the US could gain a heavy rare earth source outside China.
- If fighting in Kachin intensifies, output from the region could fall regardless of diplomacy.
Price risks
- A disruption in Kachin State could tighten global heavy rare earth supply.
- Myanmar lacks refining capacity, so any new route would still need processing elsewhere.
United States
China
India