NARVA, Estonia — Right on the Russian border, Europe’s first commercial-scale rare-earth magnet factory is starting to supply automotive and green tech customers from a forgotten corner of Estonia.
The project represents an act of defiance against Russian aggression. It’s a bid to counter China’s chokehold over critical minerals that is Beijing’s trump card in its escalating trade war with the United States. And it’s a vote of optimism regarding European industry, its backers say.
“The future of Europe’s competitiveness is here,” Estonian Prime Minister Kristen Michal said at the opening of the factory last month. On the day of the ceremony, Russian military jets intruded into Estonian airspace.
The first phase of the new factory, owned by Neo Performance Materials, will be capable of producing magnets for 1 million electric vehicles and 1,000 generators for the wind industry annually. These magnets make electric systems more efficient, and demand is picking up rapidly.
European Commission President Ursula von der Leyen even brought a magnet made in Narva to the G7 summit in Canada in June, where she handed it to Prime Minister Mark Carney, in recognition of Neo’s Canadian roots.
As they are made with rare earth elements — metals whose extraction and refining is dominated by China — there was no commercial-scale production in Europe before Neo set its sights on this city right on the Russian border.
Just east of the factory, a fortress sits on each bank of the Narva River, which forms the EU and NATO’s border with Russia.
But it’s not just European industry that is counting on the plant run by Neo. Estonia and the rusting province around Narva also see it as vital to their futures.
