en.Wedoany.com Reported - The quantum hardware industry is entering a phase of scaling, but its critical raw material supply landscape reveals structural vulnerabilities. A new report jointly published by CIRCULAR REPUBLIC and the Munich-based cryotechnology company kiutra points out that quantum hardware depends on a small set of critical raw materials such as rare earth elements, niobium, gallium, indium, and helium-3, for which Europe has extremely low self-sufficiency rates. The supply of rare earths is highly concentrated in China, as is the case for gallium and germanium; meanwhile, Brazil controls 92% of the global niobium supply.
In April 2025, export restrictions by China caused rare earth magnet exports to plummet by 74% year-on-year, leading to production line shutdowns at multiple automotive and wind turbine manufacturing sites across Europe. Currently, the global recycling rate for these materials remains below 1%. When supply chain fragility can no longer be ignored, the cost of retroactive redesign is far higher than building resilience from the outset.
Unlike the semiconductor and battery industries—where vulnerabilities often only become apparent after supply chains are locked in—quantum hardware companies still have room to adjust. Supplier relationships have yet to solidify, and technology architectures are still being defined. The report argues that circular supply chain strategies are precisely the mechanism for Europe to avoid repeating its import dependency mistakes in one of its most strategically important emerging industries.
To this end, CIRCULAR REPUBLIC and kiutra have proposed the establishment of a "Circular Quantum Industry Alliance." The initiative has already received support from the European Quantum Industry Consortium and aims to bring together quantum hardware companies, enabling technology suppliers, research institutions, and policymakers to embed circularity as a design principle for scaling and creating economic success within the European quantum ecosystem.
Polina Ivanova, Project Manager at CIRCULAR REPUBLIC, stated that other industries, such as the rare earth magnet sector, have already shown warning signals, but lacked sufficiently early and scaled collective action; the quantum industry is at that inflection point, and the report and alliance initiative are tools to drive the industry to seize this opportunity. Tomek Schulz, COO and co-founder of kiutra, noted that as a provider of quantum cryogenic infrastructure, they are observing in real-time how complex material dependencies are forming, and the quantum industry still possesses conditions that other mature industries never had: available circularity guidelines and sufficient time to act.
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