Rare earth metals have become the lifeblood of modern technological advancement, underpinning everything from electric vehicles and wind turbines to smartphones and advanced defense systems. The VanEck Rare Earth/Strategic Metals ETF (REMX) offers investors targeted exposure to a sector increasingly viewed as critical for global decarbonization and geopolitical independence. As governments ramp up infrastructure investment and transition away from fossil fuels, demand for rare earth elements (REEs) is poised to skyrocket, positioning REMX as a compelling long-term growth vehicle.
One of the primary bullish arguments for REMX is the growing global push for supply chain security, particularly in the United States and Europe. Currently, China dominates over 80% of the rare earth processing market, creating a vulnerable chokepoint in the supply of these strategic materials. In response, Western nations are aggressively investing in domestic mining and processing facilities, many of which are represented in REMX’s portfolio. Legislative tailwinds such as the U.S. Inflation Reduction Act and EU Critical Raw Materials Act further support capital inflows into the sector, making REMX a key beneficiary of shifting geopolitical priorities.
Finally, the demand trajectory for rare earth metals remains overwhelmingly positive, underpinned by structural megatrends. EV adoption alone is expected to require vast quantities of neodymium and praseodymium—critical inputs for permanent magnets in electric motors. Additionally, the proliferation of renewable energy systems, 5G infrastructure, and military modernization efforts all point to sustained, high-intensity demand. With its diversified holdings across global producers, refiners, and processors of rare earth elements, REMX provides an accessible way to tap into these accelerating trends while hedging against supply-side bottlenecks and resource nationalism.
The chart at the top of this article shows that REMX has reversed a three-year-long downtrend, with indicators like RSI and MACD confirming the breakout to the upside. There is a lot of room to run. We believe the rally is in its early stages.
Dennis Leontyev
