Rare earths are raw materials are essential for many future technologies and play a key role in the energy transition, digitalisation, and the creation of industrial value. However, the extraction and processing of these materials is heavily concentrated in China, creating significant dependencies for Germany and Europe. This study provides a concise overview of the current and future supply situation, geopolitical developments, and potential demand in key application areas. It also examines the opportunities and challenges along the value chain, particularly with regard to recycling and establishing a circular economy. Furthermore, it proposes policy options to achieve a more stable and resilient supply of rare earths, including expanding European processing capacities, diversifying supply sources, stockpiling and developing alternative materials and technologies.