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In this episode of ETF Spotlight, I speak with Brandon Rakszawski, Director of Product Management at VanEck, about rare earths, which have become a new battleground in the trade war with China.

Rare earths, a group of 17 metallic elements, are actually quite common in the Earth’s crust, but their extraction and refining are costly, complex, and harmful to the environment.

Because of their optical, magnetic, and electrical properties, these minerals have become critical inputs across many sectors, including defense, clean technology, smartphones, and data centers.

China currently controls about 90% of global rare earth production and the refining of rare and other strategic metals. Given the importance of these materials and China’s dominance, many nations are working to build alternative supply chains, though such efforts will likely take years to meaningfully reduce dependence on China.

The VanEck Rare Earth and Strategic Metals ETF (REMX - Free Report) invests in companies involved in the production, refining, and recycling of rare earth and strategic metals and minerals. It has surged almost 80% year to date.

Its top holding, MP Materials (MP - Free Report) , recently received a $400 million equity investment from the Department of Defense, making the government its largest shareholder. Apple (AAPL) also signed a $500 million deal to purchase rare earth minerals from MP Materials.

Brandon is also bullish on areas such as nuclear energy and semiconductors. Investors may want to take a look at the VanEck Semiconductor ETF (SMH) and the VanEck Uranium and Nuclear ETF (NLR).

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