New Delhi: A Chinese-backed militia, the United Wa State Army (UWSA) has seized control of newly discovered rare-earth mining sites in Shan state, east Myanmar.
It escalated Beijing’s strategic efforts that aimed to dominate the critical mineral supply chains amid escalating tensions with the US.
Satellite imagery from Planet Labs and Maxar Technologies reveals that since early 2023 multiple leaching pools, used to extract heavy rare-earth elements have appeared in the forested hills between Mong Hsat and Mong Yun, not far from the Thai border.
Operations intensified, Shan state mines operate under USWA’s protection
By early 2025, operations have been intensified with at least a dozen pools visible at one site and twenty others at a nearby location according to a Reuters report.
Local sources have confirmed more than 100 workers, managed by Chinese speaking supervisors and are extracting dysprosium, terbium and other heavy rare earth oxides. These are the essential components of motors, wind turbines, medical devices and electric vehicles. Trucks have been spotted transporting ore towards China around 200 kms away.
Unlike the conflict ridden Kachin mining belt in northern Myanmar that disrupted China’s supply in early 2025, the Shan state mines operate under UWSA’s protection. Observers have said UWSA with its 30,000-35,000 personnel and ties to Beijing, is positioning itself as a stable partner for Chinese firms.
China’s monopoly of dysoprium and terbium
Myanmar based extraction is significantly cheaper and less regulated than domestic Chinese operations or western alternatives. Benchmark Mineral intelligence estimates that heavy rare earth oxides produced in Myanmar can cost up to seven ties less.
China currently processes nearly all global supplies of dysoprium and terbium into permanent magnets. Yet Myanmar provided roughly half of China’s imports for theses materials in the first four months of 2025, according to Chinese customs data. Beijing’s choice to shift operations to Shan has further reflected its desire to maintain leverage amid the ongoing US China trade friction.
First large scale operations outside Kachin
The prices have surged over 27 per cent in the past six months, while dysprioum oxide has seen sharp fluctuations. Such spikes have highlighted the ongoing geopolitical significance of rare earths often referred to as the, “oil of the tech age.”
Despite repeated requests, neither China’s Ministry of Commerce, Myanmar’s military junta nor the UWSA responded to the inquires posed by Reuters.
Scholars such as Patrick Meehan of the University of Manchester and David Merriman from Project Blue who have analysed the satellite imagery confirm that theses are the first large scale operations in Shan outside Kachin.
As conflict in Kachin disrupted traditional supply sources, Beijing appears to be reshaping supply chains to shore up its strategic position. The UWSA-run Shan operations thus become a new linchpin in China’s quest for rare-earth dominance—one that is cheaper, more secure, and firmly aligned with its geopolitical strategy.
