Rare Earth Market Needs Competition, Says US Congress
Over the past two weeks, lawmakers in Washington have debated resurrecting a domestic supply-chain for rare earths and creating a national stockpile for the family of elements in response to China's monopoly over the minerals.
By Desmond McMahon-Exclusive to Rare Earth Investing NewsOver the past two weeks, lawmakers in Washington have debated resurrecting a domestic supply-chain for rare earths and creating a national stockpile of the elements in response to China's growing monopoly over the minerals. The Congress' subcommittee on Science and Technology addressed Rare Earth Minerals and 21st Century Industry, and in his opening statements Chairman Rep. Brad Miller (D-NC) lamented how quickly China has taken over rare earths production. “The United States, not so long ago, was the world leader in producing and exporting rare earths. Today, China is the world's leader,” he said. US domestic production slid dramatically through the early part of the 21 st century due to low prices, which some experts attribute to Chinese state-owned production, home-grown environmental concerns;,and less government support, testified Karl Gschneidner, Jr., a senior metallurgist at the US Department of Energy's Ames Laboratory in Iowa. Now, the US relies almost entirely on China to supply rare earths despite holding approximately 15 percent of the world's reserves on US soil. Dudley Kingsnorth, of the Industrial Minerals Co. of Australia, estimated that by 2015 the world demand for rare earths will total at about 210,000 tons. He expects China will churn out around 170,000 tons, leaving it up to the rest of the world to supply the remainder. Miller says now is the time to recognize the importance of these minerals and act. He also notes China's policy on rare earths is changing. “China appears to view rare earths as one of the incentives they can offer a technology firm scouting for a new plant location. How do we compete in attracting and retaining manufacturing firms that need access to rare earth elements in light of China's current near monopoly, and their willingness to use their monopoly power to our disadvantage?”