Rare Earth Elements Vital For US Defense And Economy
The ‘RESTART' Act proposed in the US congress is aiming to reduce America's dependence on China for the supply of rare earth elements vital for US weapons and defense industries as well as electronics and green technology companies. The bill seeks to assist mining and processing operations, as well as create a strategic stockpile of various rare earth elements.
By Michael Montgomery—Exclusive to Rare Earth Investing NewsThe desire for Rare Earth Elements for use in military equipment and emerging green technologies in the US has prompted Congressman Mike Coffman (R-Colorado), to introduce a bill aiming to create a domestic supply chain. The Rare Earths Supply-Chain Technology and Resources Transformation Act of 2010 (RESTART Act) seeks to establish federal assistance for the creation of mining operations, processing facilities and the creation of a stockpile for national defense. The bill echo's much of the current market analysis citing concerns over the monopolistic power of China's rare earth market dominance. Currently, China controls 95 percent of the total rare earth supply. Over the last decade the explosion of China's economy has meant that the nation has increasingly used more of its own rare earth supply for consumer goods. The domestic consumption rate will only increase with the urbanization and modernization of China. The Chinese have made cut backs to export quotas by 6 percent a year over the last 5 years. Last summer, a leaked report stated that the Chinese were considering a complete export ban of the most crucial rare earth elements. At a conference in Beijing, researcher Zhang Anwen told attendees that China would continue to export REE's, however, he stressed that other nations should be looking to create their own supply. “Foreign countries should calmly and logically think about this and develop their own mines for their own needs. Our resources are diminishing. And we need these minerals for our own use,” stated Zhang Anwen, in a PBS Newshour report. The increasing use of handheld electronics, hybrid vehicle, and renewable electrical production has led to an explosion in magnet and battery technologies, all of which rely heavily on REE's for their construction. However, many of these products are made in China, the controller of the worlds supply. While the RESTART Act aims to reduce the vulnerability of American corporations and military to the whims of Chinese export quotas, it seems the desire is more for the latter. This is simply because the vast majority of the electronics made for American companies is produced inside of China, as well as the lack of processing plants inside the US for the complicated processing of rare earth ore into pure oxides.