A new owner of the Chinese rare earths group would also raise questions over its stake in MP Materials
Reuters reported exclusively over the weekend on a possible takeover of Shenghe Resources by the state-owned China Rare Earth Group. Talks had been underway since the beginning of the year, according to the news agency, citing people familiar with the matter. Shenghe Resources, a publicly listed Chinese rare earths group with numerous international holdings, has since pushed back against one key aspect of the report: according to its controlling shareholder, there are no plans to transfer control of the company to an external party. The shareholder in question is the Institute of Multipurpose Utilization of Mineral Resources, a state-run Chinese research institute for mineral resources based in Chengdu.
However, the statement does not say whether talks or preliminary discussions with China Rare Earth Group have taken place.
Shenghe also holds a stake in MP Materials
Shenghe’s international holdings include a stake of around three percent in MP Materials, the operator of the Mountain Pass mine in California. If Shenghe were to come under the control of a Chinese state-owned group, its stake in MP Materials would therefore also indirectly come under Chinese state control. Given the strategic importance of the U.S. company, this would raise questions about how the stake would be handled going forward. According to Reuters, it remains unclear what impact a possible takeover would have on Shenghe’s overseas holdings.
For years, Shenghe purchased a large share of the rare earth concentrate produced at Mountain Pass and marketed it in China. This supply relationship ended in 2025, while the offtake agreement between the two companies expired in early 2026.
Photo: Alexandr Baranov via Canva
