Abstract
<jats:p> Rare-earth permanent magnets (REPMs) are crucial for electric vehicles, wind turbines and other high-efficiency electric motor systems. However, their production is energy intensive, and global recycling rates are below 0.2%. Machining swarf is the main industrial waste from REPMs production. Despite its high rare-earth elements (REEs) content (~20 wt.%), it has received limited attention for sustainable recycling. We introduce hydrogen plasma reduction (HPR) as a new environmentally-friendly method to recover REEs from REPM swarf. By tuning the hydrogen content and treatment time, we obtain phase‑separated metallic Fe and high-purity rare-earth oxides that are usable as direct feedstock in REPM production. The process also enables direct rare-earth hydride formation, confirming the in-operando metallization of rare-earth oxides in melted state. This procedure turns REPM swarf into separated, high-value, high-purity feedstock in a single, acid-free step. Our approach reduces the huge 70 kg CO <jats:sub>2</jats:sub> /kg average footprint of finished magnet by about 90% and decreases the dependence on critical REE supply chains. </jats:p>