The UK's rare earths industry ambitions have taken a hit as a major refinery project in East Yorkshire has been scrapped. The Saltend Chemicals Plant near Hull, which was set to process raw materials into powerful magnets, has been abandoned in favor of a US investment. This decision comes as a result of China's market dominance and artificially low prices, making UK refining uneconomic without significant government support. Despite the UK's initial enthusiasm, including a multi-million pound investment from the Tory government, the project has been deemed unviable. The UK's reliance on rare earths, which are relatively common but difficult to extract, has been a point of contention. Chancellor Rachel Reeves has acknowledged the growing tension between the US and China over rare earths and is working on a critical minerals strategy to reduce dependency. The UK's strategic foothold in the industry was seen as crucial, but the project's cancellation highlights the challenges of competing with China's market power. Pensana's founder, Paul Atherley, has expressed disappointment, comparing the UK's contribution unfavorably to US government support for similar projects. The company is now focusing on a sustainable, independent rare earth supply chain in the US and plans to list on the Nasdaq stock exchange. Despite this setback, Atherley remains optimistic about the UK's potential in other areas, such as lithium refining in the Northeast.
