Dan here…Lifted with permission from an e-mail from Tim Worstall, an expert in rare earth issues and resources, in response to my sending him the NYT article suggesting China was using rare earth resources as both a trade issue (notice NYT suggestion the pass on processed product versus raw material export)) and political leverage with Japan using their detention of a Chinese fisherman.
by Tim Worstall
In brief, the Chinese have just f**ked themselves over if the NYT take on the issue is accurate.
By showing that they’re willing to use RE supplies as a political lever they’ve just made them political for everyone else.
Thus there will be a political insistence that non-Chinese sources will be found.
It will make Mountain Pass’ environmental problems easier to overcome, make funding Mount Lynas easier. It’ll make it more likely that I’ll get my grant to extract REs from the wastes of alumina production (yes, it does work, we just don’t know whether it’s economic as yet, thus the grant).
Most importantly perhaps, it’ll make the politicians concentrate on what’s actually important here. REs aren’t rare but the ability to separate them is. There are any number of places around the world where I could scare up a few tens of thousands of tonnes of rare earth ores. Really, almost trivially simple.
However, separating them can take thousands (yes, really, thousands) of iterations of boiling them in hot acid. And when you’re done you’ve still got the thorium almost always associated with them to dispose of. So, politicians will have to accept that if they want windmills and electric cars then they’re going to have to allow people to play with boiling acids: and they’re going to have to find a repository for all that thorium (for it is radioactive, if only mildly so).
There is, other than the boiling acids thing, a possibility that we’ll go off and find another way of separating the rare earths. While there have been academic advances in this subject over the past 30 years there haven’t been any practical ones, no attempts to apply them. Why bother when China is doing it all for us? I could even tell you what one of the likely and useful methods to investigate is: but then I’d have to kill you as that’s the subject of my next grant application.
Finally, a political point. No, this doesn’t show that we must at all times maintain a domestic industry to do this or that for the fear that someone will start to play politics with our supply of this or that. We do have a few years ahead of some fairly serious amounts of money to be spent on getting RE supplies. But we’ve saved 30 years’ worth of subsidy, a far larger sum, by not maintaining a domestic industry until we needed to.
For almost all commodities, metals, foods and so on, there are so many alternative sources we could develop if we needed to that no one can actually, in anything other than the short term, control our access to them.
If Chile started to use tellurium supplies as a political weapon then I might get a little more worried: anything else I just don’t see it being possible. And it’s certainly not a serious medium or long term threat to anyone other than the Chinese RE producers themselves that China is playing politics with the supply. All they’ve done is increase the funding available through political channels for the creation of alternative sources of supply.
Sensible advice to China would have been that if you want to start behaving like a monopolist you’d better make sure that you actually are a monopolist first. And they aaren’t, not over any reasonable timescale.
(Dan…slightly edited for readability)
Update: h/t MG for the following links:
Alexis Madrigal provides an update on restarting U.S. production. Of course, it will take $500 million and perhaps as long as 15 years to put all production back in place.
Worried About China’s Monopoly on Rare Elements? Restart American Production
Sep 23 2010, 12:25 PM ET
In the U.S. House, there is the Rare Earths Supply-Chain Technology and Resources Transformation Act of 2010 or RESTART Act which was introduced in March 2010. No major action…yet.
H.R.4866 – RESTART Act