“There will be increased competition for scarce natural resources such as critical minerals, including rare earth elements, and control of supply may be used as leverage on other issues,” the UK Government’s integrated review of British defence and foreign policy warned last year.

Tory MP Alexander Stafford, who represents the former mining area of Rother Valley, Yorkshire, recently argued that “China holds the cards in many of the supply chains which form the foundation of the global economy”, blaming “decades of Western sleepwalking”.

Along with the environmental footprint of the rare earths industry in China, these concerns are prompting politicians in America and Europe to support efforts to diversify supply chains once more.

In the US, Joe Biden’s administration has funded the development of a new processing facility in Texas, set up via a joint venture between Blue Line and Australian mining giant Lynas. Rare earths will be shipped from Lynas’s mine in Western Australia for final processing in Texas. 

The defence department has also funded the reopening of the Mountain Pass mine in California, previously closed in 2015 after its owners went bankrupt.

Britain’s manufacturing push

Meanwhile, the UK Government has given grants to firms such as Cornish Lithium – which is investigating supplies of lithium, used to make batteries for electric vehicles – and to UK Seabed Resources, which is sweeping the floor of the Pacific Ocean for metals.

Pensana too is benefiting from British policies by building its plant inside Hull’s new freeport, sparing it from import and export tariffs. It may also get grant funding, should an application prove successful. 

Chairman Atherly says this, along with other factors such as the locally skilled workforce, is why the firm chose the site at Saltend Chemicals Park, where there is also existing infrastructure.

From next year, his company plans to begin refining rare earth minerals – neodymium and praseodymium – used in the production of magnets, vital to the green energy revolution. 

Inside a single, 260-metre tall wind turbine, for instance, is roughly seven tonnes of powerful magnets. When the turbine’s rotor turns, it spins copper coils around the magnets to generate electricity.

It means that Pensana’s facility, which aims to produce about 4,500 tonnes of metal oxides per year, should have plenty of demand from giant wind farms being built off the coast of Yorkshire.

Further down the line, Pensana aims to ramp up production to 12,500 tonnes of rare metal oxides per year – equivalent to 5pc of global demand