Opinion: The rare earth challenge

10/19/2010 4:31 PM EDT

Considering how rare the "rare earth" elements are, recycling seems like an obvious way to get them. There are proably more rare earth elements in your average TV or computer that gets sent to a land fill than in an equivalent amount of ore that they came from originally. Seems like someone is missing an opportunity here. China is already exporting the ore to us in the products they make!

10/19/2010 5:21 PM EDT

Tungsten is another example of a relatively rare element that is very important, for instance for high performance steels, tools, but also used in IC metal layers. Apparently China has 90% of world supply.

Tungsten was of course widely used in incandescent lamps, so municipal waste dumps might be a good source of it.

10/19/2010 5:40 PM EDT

An article in the NY Times today made a couple of interesting points. For one, rare earths "aren't particularly rare." It's just much cheaper to mine them in China given subsidized capital, subsidized labor, and virtual absence of health/safety requirements. So the mining companies in North America stopped production. Of course there was no response from Congress or the Defense Department, which had much more important issues to consider.
Second, the Chinese export restrictions may be as much motivated by the rapid exhaustion of their own reserves as by politics. They, unlike the USA, don't wish to have their future growth dependent upon foreign suppliers.
One of the first steps when facing a potential protracted threat is to secure one's supply lines. As long as US industrial policy remains available to the highest bidder on short notice, we will fail to accomplish this. There is only one plausible outcome, absent an attitude of prolonged charity on the part of the Chinese.

10/19/2010 6:38 PM EDT

China is violent dictatorship and only recently adopted seemingly humane internal policies based upon the realization that international commercial progress is paramount. A seemingly benign dictatorship can always out perform a muddled democracy into such as our republic has declined. We must regain the seemingly jingoistic behavior of Teddy Roosevelt, eschew our self indulgent squealing over pc crap and take charge of the corrupt, lobbyated legislatures in all the states and DC, too, forcing, with one-termism, behavior which will regain our lost self confidence. Let us dump the pusilanimous media, with the down guiding bleed-lead trajectory and pandermonious
sit-calms dragging our intellects though commercials for crapanjunk we never will need.
Screw China and Charlie Rose who yearn for our decline so they might rise. Let's take charge of ourselves, stop yielding to liberal weaknesses, physical, logical and philosophical, and rise again,in our own eyes.

10/20/2010 8:20 AM EDT

The Chinese hardly play fair. But what's new about that in business. In the mid-90s two Chinese groups and a U.S. investment firm tried to acquire Magnequench, a business set up by GM for rare earth metals-based magnets for its vehicles. The purchase was reviewed by our government and finally went through after China agreed to keep Magnequench in the U.S. for at least five years. The day after that deal expired all employees were laid off and the company moved to China. It might not have been critical at the time, just another smart business decision.

10/20/2010 10:51 AM EDT

What is interesting is that inside China, the media has been blasting Chinese government for selling off the national treasure (rare earth) at exorbitantly cheap prices to the West, allegedly under Western pressure so the West, especially the US can exhaust China's reserve. China is actually the victim in this game. It is just interesting to see how people in different countries can have diametrically opposing opinions on the same issue.

10/20/2010 2:40 PM EDT

http://news.softpedia.com/news/California-Mine-Reopened-to-Search-for-Rare-Earth-Minerals-120505.shtml
http://www.molycorp.com/

10/20/2010 3:20 PM EDT

How about helium? The US controls the bulk of that commodity, but is essentially being given away free based on the stupidty of US government short-sightedness.

10/20/2010 4:28 PM EDT

I wouldn't put much credit on Chinese Media since they print what they are told to. Apologies to pixies. If the Chinese government didn't want published criticism it wouldn't appear. A great way to smokescreen a self serving policy.

10/20/2010 5:03 PM EDT

True, Chinese media are heavily filtered. It is an art form to read Chinese news. However, Chinese society is so dynamic nowadays and with the internet, it is hard to conceal all the different voices. In fact, the government has to be, to some degree, responsive to public opinions. Sometimes, under the pressure from the public opinion, which is channeled by the government filtered media (kinda like a positive feedback loop), the government has to take unnecessarily hard stance.

10/20/2010 5:42 PM EDT

Pixie is blowing rare earth fairy dust at us. If the renimbi was allowed to be fairly valued the "exorbitantly cheap prices" would appear considerably less so.
Re-mastered 8-track tapes of "Rare Earth"? Why would anyone think these would not be pirated like any other Western IP?

10/20/2010 6:57 PM EDT

Switched-reluctance machine (sometimes called Variable-reluctance). Used for wind generators, washing machines, heavy equipment (LeTourneau), etc, etc. American software engineering replaces Chinese commodities.

Look, Ma, no neodymium, samarium, or dysprosium!

10/20/2010 11:31 PM EDT

China does not want to export these rare earth materials to us, but Congress allows high-tech company like Advanced Material to build plants in China? And the computer maker Dell invested billions in China? Wow, America: the land of the Dummies!

10/21/2010 2:36 AM EDT

There is already some work in progress in Australia and Canada to take care of future rare earth requirements of North America .
See last two lines in the paragraph "World Production Scenario" in the link below
http://www.portal.gsi.gov.in/portal/page?_pageid=127,719655&_dad=portal&_schema=PORTAL

10/21/2010 2:10 PM EDT

Thanks for posting this link. Here's the relevant passage:

"Nolans Project in Central Australia, the remote Hoidas lake project in northern Canada and the Mt. Weld project in Australia. The Hoidas Lake project has the potential to supply about 10% of the $1 billion of REE consumption that occurs in North America every year."

10/21/2010 5:10 PM EDT

the US used to have rare earth production, but shortsightedly because of price reason dismantled it, such a smart decision could be made by good managers only.....

10/23/2010 1:38 AM EDT

For sure china behaviour is a problem but the rare earth isue is much more than a business and cost issue it is really a problem related to the way we all of us consider this planet today. Having RE in US dosn't solve the issue it just postponne the real issue which is a real shortage whatever the price. THe worl is finished, we are hitting the world limit and it is more than urgent to think differently and really starts to put in place real and true sustaniable solutions

10/23/2010 1:41 PM EDT

Trying not to get too political here, this is EE Times after all ;-)...I believe the market will largely regulate the issue for rare elements...if they get to be truly rare their price will go up, products and technologies based on them will get more costly and something else will be developed...yes, there will be tumultuous transitions in the meantime but at the end market will work out a new equilibrium...Kris

10/23/2010 8:23 PM EDT

Can we recycle and extract out from used stuff?

10/25/2010 5:13 PM EDT

Chine is not exclusive producer of rare earth elements
and many other countries have rarely earth elements.
But now they have closed mines and using REE from China. Or put it on the sea bottom future while China sells it by low prices.

http://geology.com/articles/rare-earth-elements/
Country Production (Metric Ton) Reserves (Metric Ton)
United States insignificant 13,000,000
Australia insignificant 5,400,000
Brazil 650 48,000
China 120,000 36,000,000
Commonwealth
of Independent
States not available 19,000,000
India 2,700 3,100,000
Malaysia 380 30,000
Other countries not available 22,000,000
World total
(rounded) 124,000 99,000,000

www.threegold.ca/documents/1_RareEarths_FLX_02.pdf
Production of rarely earth elements, metric tons of rarely earth oxides equivalent
1985
United States 17'083
Australia 8'328
China ?
1993
United States 17'754
Australia 1'650
China 22'100
1993
United States 0
Australia 0
China 90'000

10/26/2010 12:55 AM EDT

No self-respecting country would sign up for a proposition where its non-renewable resources are on a one-way track: export! I don't fault China for her stance; her methods may be crude, but by and large, her intention may be in the right place. The media odds are against her, especially in the west, to the extent that no amount of PR may fix it in the near future!

Geopolitics are a complex game; they are a class of infinite games where the parties may declare their intentions upfront but have no intention of reaching Nash equilibrium. China seems to be doing just that.

Dr. MP Divakar

10/26/2010 6:58 AM EDT

India wants to fill this gap and be a supplier to Japan and possibly to US also in future .
See this new headline :

http://economictimes.indiatimes.com/news/economy/foreign-trade/India-to-export-rare-earths-to-Japan/articleshow/6812060.cms

11/9/2010 9:58 PM EST

I have a bit of experience in the motor arena and did some research on this. First, the material we are talking about is Neodymium which is needed for Neodymium Iron Boron permanent magnets. These are the highest energy density permanent magnets known. Wind power, Electric vehicle motors, and medical imaging equipment all use it.

Second, the point about Ferrite is very clear, if you need low price and can sacrifice power density, any electric motor design can be converted to Ferrite.

What is less well know is how it got this way. Since General Motors was a primary patent holder for the Neodymium Iron Boron magnet and a spin casting process for making the material, one wonders how the US lost its grip. Maybe GM was cash poor and the Magnaquench division in Indiana was worth more to them as cash than as a source for high performance magnets. But since US military equipment uses the magnets, why didn't the Defense Department block the sale of Magnaquench to New Materials Technology in Canada which is a front for a group of Chinese investors. Who promptly shut down the Indiana manufacturing facility as "too expensive to operate within the cost structure of the rest of the company".

Where we are today is not as dire as is being reported. The financial markets have been speculating for a couple of years about Neodymium and the REE. But the fact is that we have huge mines in the US and in Australia. The US mines have been under development for several years by Molycorp who had the foresight to get into the California mine with private equity. They are in a manufacturing agreement with Arnold magnetics to make NeFeB magnets here in the US to compete with the short Chinese supply.

I don't think there is a long term problem, but there is sure a lot to answer for in terms of how the US government let us get here. Same with Carbide for cutting tools, Zirconium and other strategic resources.