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Rare Earth Minerals: Their Increasing Importance to China, Japan and the Rest of the World

Wednesday, March 2nd, 2011

Today’s world is increasingly at odds with the use of nonrenewable resources, particularly fossil fuels and their derivatives.

These are proving increasingly unsuitable not only because they are inherently “dirty” but also because, in the eyes of some, they subject those who make use of them to terms and conditions that are largely dictated by the nations that produce them.

For this reason, nations the world over are looking to switch to other resources and/or methods of generating energy that eschew coal, oil and gas. In addition to established alternative technologies such as solar, wind and hydroelectric generation, rare earth minerals are rapidly coming to the fore, and, thus, in the eyes of many, represent the “next big thing” in power-generation technology and tactics—a “sea change” from the methods and technologies that prevail today.

However, say some experts, significant drawbacks may ensue as a result of an increasing worldwide dependence on rare earth minerals. Foremost among these drawbacks may have to do with the fact that one nation—China—is currently responsible for nearly all of the production of the most commonly used rare-earth elements.

This article will present an introduction to rare earth minerals, discuss their uses and importance, touch on the political economy of rare earth minerals, including potential resource protectionism that may be springing up to control the supply of these minerals, and wrap up by discussing the prospects for rare earth metals in the new millennium.

What are rare earth minerals?

The International Union of Pure and Applied Chemistry (IUPAC) define rare earth metals or elements as a collection of seventeen chemical elements in the periodic table. More specifically, these are the fifteen lanthanides, as well as scandium and yttrium.

Despite their name, most of these elements are easily found in the earth’s crust, and are often found together as well. For instance, cerium, the most abundant, is also the 25th most abundant element, similar to copper. Thanks to their special properties, however, these elements are only rarely found in concentrations that allow them to be economically and commercially made use of. These concentrations are in general what are known as rare earth minerals.

Rare earth elements are not a new discovery; they have been known to science for over two centuries now. The first, “ytterbite” (renamed to gadolinite some years after its discovery) was discovered in 1787 by Carl Arrhenius in a quarry located in a Swedish village named Ytterby—whose name served as the inspiration for several of these elements. The others were discovered in the years following the discovery of gadolinite.

Principal sources of rare earth elements include the minerals known as monazite, bastnaesite and loparite, as well as other substances known as lateritic ion-adsorption clays. Mining rare earth elements is similar to the process utilized to mine salt or coal; pit mining is considered less environmentally risky and safer for workers to boot.

The particular chemical properties of rare earth minerals make them far more difficult to mine and extract than many other substances—a fact that has served to make them relatively expensive for many years. In addition, until efficient separation and processing techniques were developed, the industrial use of rare earth minerals was correspondingly very limited.

Before 1948, nearly all the world’s rare earth minerals came from India and Brazil. In the 1950s, however, large deposits of monazite were discovered in South Africa, and the country took the place of India and Brazil atop the list of rare earth sources. A decade later, in the 1960s, it was the United States’ turn to take the title, when the California-located Mountain Pass mine became the world’s leading producer of rare earth minerals. Today, even though some of these sources are still producing rare earths, China has taken the lead. The country’s mines produce a whopping 97percent of the world’s supply of rare earths. The bulk of this is produced in Inner Mongolia, most especially in the Bayan Obo mining town, whose mines are said to contain the largest deposits of rare earth yet found.

Uses of rare earth minerals

Science has known of the existence of rare earth minerals for quite some time, as discussed in the previous section. However, the fact that they were very hard to process and separate limited their usage. In recent years, however, thanks to new and effective processing and separation methods, the applications of rare earth elements and minerals have grown apace.

Rare earth minerals are now key components of rare earth magnets, catalytic converters, superconductors, hybrid-car magnets and batteries, certain types of communication systems (optical-fiber systems require erbium-doped fiber amplifiers), plasma television sets, mobile phones, wind turbines, nuclear batteries, computer memories, lasers and the like. Importantly, many applications of rare earths are defense-related. For example, the propulsion system of the American Arleigh Burke- class destroyers, as well as a certain type of radar used in warships that are equipped with the Aegis Combat System, an integrated naval weapons system used by the navies of the United States, Japan, Norway, South Korea and Spain, with Australia soon to follow. Moreover, in many of these key applications, no substitute exists for rare earths.

These key applications for rare earth minerals have made them extremely strategically important for many nations across the globe. However, the fact that they are not only scarce but also found in such concentrations in so few areas around the world is cause for concern.

The political economy of rare earth minerals

Thanks to their increasing importance in a wide range of cutting-edge applications— many of which are strategically important—nations the world over are embracing rare earth minerals. However, the fact that experts say that demand is soon to outstrip supply, combined with the fact that current production is so dominated by one nation, is giving many nations pause for thought.

Ostensibly to protect its scarce natural resources and protect its environment from further degradation, China has in the past announced rare-earth smuggling crackdowns and export regulations. As reported by Manufacturing.net last September 2009, China announced that it would reduce its export quota of rare earths to 35,000 tons yearly from 2010 to 2015. In June 2010 China.org reported that two Chinese government bodies, namely the National Development and Reform Commission and the Ministry of Industry and Information Technology, had crafted a draft plan to limit rare earth mineral mining to only a few selected State-owned enterprises (SOEs). In addition, China Daily said in October 2010 that China was to further reduce quotas for rare earth exports by 30 percent to further guard against over-exploitation.

Such actions have made it very hard for many countries and sectors to acquire the rare earths they increasingly need from a source that is becoming increasingly strict regarding the amounts of rare earth it is willing to sell—a problem that some experts say approximates that faced by most of the non-petroleum-consuming world during the oil shocks of the past. However, plans are continuing apace to help these producers and industries continue to make use of rare earths.

Sourcing rare earth minerals in the new millennium

According to the BBC in an article published last November 2010, three efforts are under way to help firms and industries that require rare earths but are struggling due to sourcing difficulties.

The first has to do with the diversification of supply through the development of other potential sources of rare earths. In 2009 the New York Times reported that searches for alternative sources of rare earth minerals in places such as the United States, Australia, Brazil, South Africa and Canada—some once and former top rare- earth sources, others new and untapped— were ongoing. The United States Geological Survey) (USGS) said in 2010 that the United States has 13 million metric tons of rare earth elements. The Mountain Pass mine in California, the world’s leading source of rare earths half a century ago and now owned by American firm Molycorp Minerals, is to reopen in 2011. In addition, Japanese markets received a boost when Vietnam signed an agreement to supply Japan with rare earths from one of its own sites. Additionally, as reported by the Financial Times last November 2010, Japan has also inked a tentative deal with Australia to purchase rare earths from them.

The second effort, on the other hand, involves the increased efficiency of the industrial processes that make use of rare earths. As reported by BBC News last November 2010, it was revealed that at the National Institute for Materials Science (NIMS) in Tsukuba, efforts were underway to develop new manufacturing methods that made use of less amounts of rare earths. The NIMS efforts, for instance, involved the use of lasers to minutely and precisely shave the surface of rare earth magnets, important for use in electric motors, one atom layer at a time.

The third effort has to do with recycling the trace amounts of rare earths in various components—used cars, electronics and the like—and selling them to specialist companies in a process informally referred to as “urban mining.” Japan, said one recycler, has a long and distinguished history as regards recycling, making it one of the best nations to initiate a process designed to recover these minute yet exceedingly valuable substances.

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