Are Investors Finally Waking Up To “The Great Rare Earth Disconnect”?

Last week, Canaccord’s critical minerals team highlighted what we call the “great rare earth disconnect”: tight supplies and elevated spot prices alongside a vicious bear market in mining stocks that began in early summer and extended into October. 

William Blair’s rare-earths analysts also commented on the downturn, challenging the market’s expectations that Chinese supply constraints would ease and calling that view “incorrect.”

The divergence between ongoing critical-material supply constraints, driven by China’s “resource nationalism,” and depressed mining stocks has some traders weighing whether shares near 52-week lows represent a buying opportunity.

The VanEck Rare Earth and Strategic Metals ETF (REMX) has fallen roughly 55% from its peak over about 24 weeks, reversing much of its advance from around $32 in spring 2025 to $111 in spring 2026. 

The fund, which holds SQM, Albemarle, China Northern Rare Earth, MP Materials and Almonty Industries, among others, rose about 4% in early Tuesday trading.

The rebound could reflect technical buying after a prolonged selloff, with shares trading near the 76.4% Fibonacci retracement of the prior rally. It could also signal that investors are reassessing expectations of easing supply constraints and recognizing that China’s “quasi-monopoly” on critical materials and resource nationalism won’t break anytime soon.