The US is trying to secure rare earth elements for national security as they are critical to its defense-industrial base, and taking steps toward breaking China’s rare earths monopoly. According to reports, the global demand and supply struggle could create a price spiral.
Dan McGroarty, a member of the USA Rare Earth advisory board, said he hopes to see “a mosaic of actions” from the Biden administration with regards to rare earths, from allocating more federal funding to collaborating with other countries half a world away like Australia and Japan (besides Canada) to secure the global supply chain. “There’s going to be a significant degree of continuation and acceleration” from Trump to Biden on critical mineral policies, he said.
Rare earth elements (REEs), a group of 17 metals, are increasingly regarded as an urgent matter of national security given their crucial role in the manufacturing of high-tech products.
REEs like cobalt, lithium, neodymium, vanadium and gallium are critical to numerous defense and commercial applications, including aircraft/UAVs/electric vehicles, sensors, precision-guided munitions, electric motors, nuclear reactors and more.
The U.S. has no domestic production of 14 critical minerals, relying completely on imports to meet demand for them.
China has no such dependency. The country commands the majority of the world’s mined REE output and approximately 80% of REE processing/separation.
A U.S. Navy submarine contains over 3,600 kg of rare earths, an F-35 fighter jet 416 kg, and a a Toyota Prius approximately 15 kg. Despite their name, rare earths actually aren’t that rare in the earth’s crust. The least abundant of these, thulium (Tm) and lutetium (Lu) are 200 times more abundant than gold. The challenge is finding concentrated deposits that are economical to mine.FORBES
Over the last ten years, China built chemical processing capacity and gone round the world buying/owning the mines and making long term agreements to ensure that raw materials flow into the country.
President Joe Biden’s ambition to make the United States less dependent on other nations for rare earths and minerals will reportedly take years to accomplish –even with sweeping changes the nation is at least a decade from becoming self-sufficient.
America lacks capacity to produce enough permanent magnets, needed to run the engines of everything from missile guidance systems to the wind turbines and electric cars at the center of the clean energy transition, says a report in Japan Times. These magnets use rare earth elements which have to be shipped from overseas for lack of domestic processing facilities.
Americans will therefore have to factor the cost of securing the rare earth supply chain as they have previously done for consumption of commodities like oil…that goes beyond investment”, recommends a recent article in Forbes.