Rare earth metals mine is key to US control over hi-tech future (Approval secured to restart mining)

[Turborama]

Source: The Guardian

Approval secured to restart operations, which could be crucial in challenging China's stranglehold on the market

Suzanne Goldenberg in Mountain Pass | Sunday 26 December 2010 16.54 GMT

=snip=

The mine is the largest known deposit of rare earth elements outside China. Eight years ago, it was shut down in a tacit admission that the US was ceding the market to China. Now, the owners have secured final approval to restart operations, and hope to begin production soon. "We will probably never be the largest (mine) in the world again. It will be hard to overcome China's status in that regard, but we do think we will be a very significant supplier," Mark Smith, chief executive of Molycorp Minerals which owns the mine, told reporters during a tour of the site.

So far as the Obama administration is concerned, the mine can't open soon enough. A US department of energy report warned on 15 December that, in the absence of mines such as this one, America risks losing control over the production of a host of technologies, from smart phones to smart bombs, electric car batteries to wind turbines, because of a virtual Chinese monopoly on the rare earth metals essential to their production.

China controls 97% of global rare earth metals production. Such total domination of a strategic resource became impossible to ignore in October when China cut exports of rare earth elements by more than 70% over the previous year, disrupting manufacturing in Japan, Europe and the US. Prices of even the cheapest of the 17 rare earth elements rose 40%.

Now America, like Japan and Europe, is desperate to find alternatives. "Reopening domestic production is an important part of a globalised supply chain," David Sandalow, the energy department's assistant secretary for international affairs told a seminar in Washington.

Read more: http://www.guardian.co.uk/environment/2010/dec/26/rare-earth-metals-us

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Very important article which deserves to be read in full.


The site of the rare earth metals mine in the Mojave desert.

Previous articles on this posted here... http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=103&topic_id=562775">Rare Earth Metals: China's Death Grip on the Trade War

[bbinacan]

1. Good news. n/t

[truthisfreedom]

2. Excellent. This will help the electric car industry immensely.

[sce56]

3. Didn't China buy the Hummer production line?

[jmowreader]

6. They were thinking about it

At the end, they decided it was a lost cause (probably because GM doesn't have a "Hummer Plant" to ship to China--the H3 is made in the same plant as GM's compact pickups because it sits on the same chassis, and the H2 is made at the same plant the Army gets theirs from) and pulled out of the deal.

[Mudoria]

4. Interesting and timely

The company I work for just signed a partnership with Molycorp in the past week. We should start production on electric car batteries within the next 12-18 months which means opening a building that had been closed for 10 years and hiring some new employees.

[salib]

5. I wonder

Why is it good that we again are simply a source of raw materials? I would rather see China selling us the raw materials and we converting these into finished products. You know, like, manufacturing.

[adnoid]

7. That's what China is doing

More and more we (the firm I work with) is unable to just get materials from China (mainly Nd) to use here in the US. The Chinese gov't wants more of the work to be done in China, while we would prefer to do it domestically.

[Theobald]

8. Did you read the article?

The article states that for a while now China has been the primary producer of rare earth metals and that recently China has reduced their exports of these rare earth metals, which has caused a shortage on the world market resulting in a spike of prices.

So you instead of having the US mine the metals, so we can actually have the materials to create the finished products, you want the US to be converting the Chinese metals which they are not shipping to us into imaginary finished products.

Brilliant analysis on your part.

[Arctic Dave]

9. Alaska has them. I wonder if they will try to extract them.

http://www.ucoreraremetals.com/bokan.asp

[Lasher]

10. Buying shit from China is cheap until they get control.

Check out the way they exploit their monopoly on pandas. It's a good example of what to expect from them if you let them get in control.

[Downwinder]

11. Oh, but we are teaching them Capitalism.

[truthisfreedom]

12. Any country would be like that. America's like that. We don't sell anything cheap to anyone.

This is about our future strategy, not pointing fingers at other countries. It's a necessity for China's prices to rise and I'm sure they see it as a necessity to control their precious resources. We just have to be smarter.

Our government has been pushing China very hard to relax their exchange rate control. This will cause the prices for EVERYTHING in China to increase, and increase the cost of everything world-wide, allowing us to compete and begin manufacturing more. But the consumers will be the ones who bear the brunt of increased costs for everything. Look up the exchange rate charts for the past few years for the yuan versus the dollar.



http://www.economist.com/blogs/dailychart/2010/11/economists_real_yuan-dollar_exchange_rate

[Art_from_Ark]

15. Higher exchange rates work both ways

"Our government has been pushing China very hard to relax their exchange rate control. This will cause the prices for EVERYTHING in China to increase..."

Actually, if China's yuan got stronger, then it would theoretically make imports in China cheaper. Theoretically, of course. And the cost of Chinese domestic labor probably wouldn't increase much.

[humblebum]

13. Doing business with China, but boycotting Cuba?

Someday we willseriously regret the decisions we have made, I'm afraid. It no longer can be denied that this has been the primary cause for the gutting of America's well-being. We have sacrificed our own future for profit.

[AtheistCrusader]

14. Or we could BUY it from Afghanistan

and raise their GDP, and employment elsewhere than the Opium fields. USGS has identified massive reserves in Afghanistan as well.

Buy it, not steal it. Help them to help themselves.