Korea Zinc eyes rare earth supply chain role with smelting and recycling technology

As China accelerates its restructuring of the global rare earth supply chain, Korea Zinc's smelting and recycling technology is drawing attention as a potential breakthrough for South Korea's rare earth security. A state-run bank's research arm has concluded that, given the country's limited mining resources, South Korea must develop "urban mining" — recovering rare earth elements from discarded magnets and home appliances.

According to industry sources Monday, Korea Development Bank's KDB Future Strategy Research Institute published a report Tuesday titled "Trends in Global Rare Earth Supply Chain Restructuring," warning that export controls on rare earths by certain countries are tightening. The institute identified "advanced smelting technology" and "status as a major demand-side player" as competitive advantages South Korea can leverage.

Rare earth elements are strategic resources used not only in electric vehicle drive motors and offshore wind turbines but also in advanced weapons systems such as missiles and fighter jets. Demand is particularly concentrated in high-performance permanent magnets, and heavy rare earths used in neodymium magnets carry high importance in advanced industries and the defense sector.

The core problem is that the supply chain is heavily concentrated in a handful of countries. China controls roughly 90 percent of the downstream value chain — including rare earth smelting, separation and magnet manufacturing. With Beijing now extending its reach into export controls, major economies including the United States and Europe are moving quickly to secure supply chains outside China.

South Korea lacks rare earth mining resources, but the institute assessed that the country possesses smelting and recovery technology built up over decades in the nonferrous metals industry. It argued that expertise in controlling large-scale chemical processes and separating valuable metals from smelting byproducts can be directly applied to urban mining — recovering minerals from discarded appliances and magnets.

Urban mining treats used electronics, motors and magnets as a kind of "mine," extracting the metals inside for reuse. Compared with developing overseas mines, the approach diversifies raw material sources and reduces waste, offering the dual benefit of resource circulation and supply chain stability.

The institute cited Korea Zinc as a leading example of this strategy. "Korea Zinc is pursuing rare earth recycling operations in the United States and working to secure a position as a key partner within the US-led supply chain," the institute said. "The company is pushing to establish an integrated smelter in the US — known as Project Crucible — that will produce 11 critical minerals, as well as a rare earth recycling plant to extract rare earths from spent permanent magnets."

Korea Zinc is currently developing the large-scale integrated smelter called Project Crucible in Clarksville, Tennessee. The facility is designed to produce not only conventional nonferrous metals such as zinc and lead but also critical minerals that the United States strategically requires, all under one roof.

The company is also working to build its own rare earth processing technology. Korea Zinc is carrying out a government-backed project to develop core equipment for a rare earth processing facility — running from April this year through December 2030 with support from the Ministry of Science and ICT. The company has already developed proprietary technology to recover rare earth mixtures from spent motors, and plans to go further by acquiring the capability to separate individual rare earth elements and refine them to high purity.

These initiatives extend naturally from the technology Korea Zinc has long applied at its existing smelters — recovering valuable metals from byproducts. The company has steadily refined its ability to extract valuable metals from byproducts generated during zinc and lead smelting, as well as from various secondary raw materials. Since Chairman Choi Yun-beom took office in 2022, Korea Zinc has pursued its "Troika Drive" strategy — built around renewable energy, secondary battery materials and resource circulation — and has expanded its electronic waste recycling operations.

"Drawing on decades of accumulated smelting, recovery and resource-circulation technology, Korea Zinc will contribute to stabilizing South Korea's critical mineral supply chain while working with the United States and other allied nations to help build a trustworthy critical mineral supply network," a company official said.