Tag Archives: rare earth elements

Solving The Rare Earth Trade Problem

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On Monday, The Epoch Times reported that President Trump has signed a trade agreement with Australian Prime Minister Anthony Albanese which will counter China’s monopoly on rare earth minerals.

The article reports:

U.S. President Donald Trump and Australian Prime Minister Anthony Albanese on Oct. 20 signed a rare earths agreement at the White House, outlining plans for both countries to jointly invest more than $3 billion in critical minerals projects over the next six months.

The White House announced that recoverable resources from these projects are valued at an estimated $53 billion, as both countries work to counter China’s global dominance in the sector.

Trump on Oct. 20 welcomed Albanese to the White House for their first formal meeting to discuss a wide range of bilateral issues, including trade, defense, and the nuclear submarine partnership.

The article concludes:

Australia views China as an increasing threat.

During the meeting, Trump noted that Beijing is paying high tariffs to the United States. He also reiterated his plans to meet with Chinese Communist Party leader Xi Jinping soon.

“I think China has been very respectful of us,” Trump said, while highlighting the billions of dollars in tariffs paid by the communist country.

Existing 55 percent levies will increase to 155 percent if Xi and Trump don’t come to terms when the two meet in South Korea in the next two weeks.

“I expect we’ll probably work out a deal with President Xi of China,” Trump said. “It’s going to be very exciting. I think we’re going to work something out that’s good for both countries.”

Trump said the United States has leverage because domestic companies sell many airplanes, parts, and components to China.

“They threatened us with rare earths, and I threatened them with tariffs, but I could also threaten them with many other things, like airplanes,” Trump said. “You know about airplanes because they can’t get parts for their airplanes. We build their airplanes.”

He suggested China is in a losing position regarding trade.

“I believe that they’re in big trouble, and I don’t want them to be in big trouble,” Trump said.

China has been working to build a monopoly on rare earth minerals for many years. It was shortsighted of western nations not to counter their efforts much earlier. Hopefully this effort is not too late.

American Ingenuity At Work

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China has worked for years to obtain a monopoly on the rare earth minerals used in our technological society. They have been pretty successful in reaching a monopoly, but American ingenuity has thrown a wrench in their plans.

On Monday, Red State posted an article quoting Fox News:

In April, China imposed export restrictions on seven rare earth elements, crippling American manufacturing across dozens of critical sectors. Ford temporarily shuttered production lines while European suppliers closed entire factories. In one calculated move, Beijing demonstrated its power to hobble the West. 

This economic warfare represents decades of strategic planning. While America slept, China cornered the market on materials essential to modern civilization. By controlling 90% of rare-earth processing capacity, it dictates prices and decides who receives supplies. The periodic table became their ultimate economic weapon. 

But weapons can be rendered obsolete through superior innovation. American scientists discovered that combining iron, the planet’s fourth-most abundant element, with atmospheric nitrogen makes a compound more magnetic than anything produced by China. This breakthrough doesn’t just match Chinese materials; it surpasses them. 

Red State reports:

That’s a great way to stick a metaphorical thumb in the eye of not only Chairman Xi, but in the eyes of all of the members of the Chinese Communist Party.

The key? Magnets. This whole thing started in the 1980s. China was producing cheap magnets and exporting them around the world, shutting down a lot of domestic manufacturing in its customer nations. Magnets have countless industrial applications, used in everything from electric motors to windmills to electronics. 

On Monday, Fox News reported:

Yet, while China was tightening its grip, American researchers at the University of Minnesota had been solving a puzzle that had frustrated scientists since the 1950s. Professor Jian-Ping Wang spent nearly a decade perfecting techniques to synthesize iron nitride magnets from the most abundant elements on Earth. His breakthrough, published in 2010, finally explained how combining iron with nitrogen can create a material with magnetization exceeding anything China produces from rare earths. 

The physics is remarkable. Iron nitride retains full magnetization at 200 degrees Celsius, exceeding the temperature capability of all magnet compounds except those made from the scarcest and most expensive critical elements. Most importantly, the raw materials come from sources no nation can monopolize: Minnesota’s iron ore deposits and atmospheric nitrogen. Iron nitride represents something China cannot replicate — American innovation driven by scientific curiosity rather than state industrial policy — and reduces our national security and economic vulnerabilities while strengthening domestic manufacturing capacity. 

Please realize that I understand none of the physics involved in this. What I do know is that American scientists have learned how to overcome the Chinese monopoly.

The Need To Be Self-Sustaining

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On August 26th, Yahoo Finance posted an article about the sudden spike in the price of rare earth elements. These are the elements that are necessary for the high-tech batteries, weapons, and necessary parts for our electronics. America is beginning to mine rare earth elements–we have them here, but we are late to the game.

The article reports:

Prices of two rare earth elements needed for super-strong magnets have surged to their highest in more than two years after U.S. miner MP Materials (MP) stopped raw material exports to leading magnet maker China amid rising demand.

China dominates the global supply chain for rare earths, accounting for 90% of refining capacity and around 70% of mined output, but the U.S. has pushed back, signing a deal with its biggest producer MP in July to refine its output domestically.

MP’s shipments had in the past three years fed 7%-9% of China’s oxide production from mine output of rare earths neodymium and praseodymium (NdPr) – vital to magnets that power electric vehicles, wind turbines and defence equipment – consultancy Adamas said.

The article notes:

Its 40% rally after several years of weakness will boost prospects for mine projects seeking investment outside China as the West seeks to wean off reliance on Beijing.

Boosting the West’s rare earth output became more urgent after China clamped down on exports in April amid a trade war with the U.S., prompting some auto plants to shut.

The U.S. government announced a ground-breaking deal with MP last month stipulating the company halt shipments to China. It also offered price support to MP for the NdPr it produces based on $110 per kg, at the time about twice the Chinese price.

China has been working hard in recent years to corner the rare-earth market. We need to consider the fact that China thinks in decades and centuries while America generally thinks in strategies of ten years or less. America needs to up its game.

The Results Of Failing To Prepare

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President Trump has been in office for about five months. He has cleaned up some of the mess he inherited, but there are going to be things that are going to take a while. Our government has not always done a good job of predicting and dealing with future problems. The problem of obtaining rare earth minerals is one that could be very serious in the coming months.

On Tuesday, Victor Davis Hanson posted an article in The Asia Times. The article reported:

America usually has other countries over a barrel. Not the other way around – unless you’re old enough to remember when the Organization of Petroleum Exporting Countries (OPEC) cracked the whip and Washington and the West usually fell in line.

But last week China forced President Trump to back down on tough tariffs that were hurting the PRC.

Rare earth minerals. They’re nearly all sourced from China and Beijing choked off exports.

Major American companies – car makers for example – warned Trump they’d have to curtail or shut down operations in a matter of weeks.

…The Trump administration reduced tariffs in exchange for Beijing’s sort-of agreement to allow rare earth exports to US customers.   

How much and how fast is unknown – but expect the PRC to slow-roll this and squeeze all it can – such as sensitive business data – from its customers.

At best, this is a temporary reprieve.

The US side also agreed to drop plans to ban Chinese students from US universities. 

It’s not that they are rare. The US has plenty of rare earths. It’s just much cheaper to source from China, and US environmental laws make domestic mining and processing difficult and expensive.

They are essential for commercial manufacturing – cars, electronics, computers, etc.

And more ominously they’re needed for military production – to include aircraft, ships, submarines, radars, missiles, lasers, satellites, guidance systems, night vision devices and more. 

It’s not Trump’s fault. He got caught holding the hot potato.

China’s chokehold on rare earths was known a long time ago.

American business and the US military knew. And Congress knew as well.

And they knew the Chinese might use their dominant position to squeeze other countries.

In 2010 after Japan detained a Chinese fishing boat that rammed a Coast Guard ship near Japan’s Senkaku islands, China banned rare earth exports to Japan.

 Japanese industry squirmed. The boat and its skipper were returned.

And Japan set about finding alternate sources of rare earths. 

The United States?

Apparently it did nothing.

It was 15 years of idiocy by the business class, officialdom and the military’s perfumed princes.

Please follow the link for further information. We need to be mining our own rare earth elements.

Winning

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On Wednesday, The New York Post reported that America had reached a trade agreement with China.

The article reports:

President Trump announced early Wednesday that the US had reached a trade agreement with China following two days of negotiations in London.

“Our deal with China is done, subject to final approval with President Xi and me,” Trump revealed in an all-caps post on Truth Social. “Full magnets, and any necessary rare earths, will be supplied, up front, by China.”

“Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!). We are getting a total of 55% tariffs, China is getting 10%. The relationship is excellent! Thank you for your attention to this matter!”

The article concludes:

The commerce secretary said the new arrangement would see China ease barriers on rare earth minerals “in a balanced way,” without elaborating on specifics.

Lutnick (Commerce Secretary Howard Lutnick) claimed that the framework brokered in London put “meat on the bones” on the Geneva consensus and would allow China to ease barriers on rare earth minerals “in a balanced way,” without elaborating on specifics.

China’s Vice Commerce Minister Li Chenggang had similarly confirmed late Tuesday that an agreement in London had been reached, subject to Trump’s and Xi’s approval.

I really would like to see a limit on the number of Chinese students allowed in our universities, but overall I think this will turn out to be a good deal.

About Those Tariffs…

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On Sunday, CNBC reported the following:

China’s exports growth missed expectations in May, dragged down by a sharp decline in shipments to the U.S., with analysts saying effects of the Beijing-Washington trade truce will be visible in June data.

Chinese exports to the U.S. plunged 34.5% from a year ago, marking the sharpest drop since February 2020, according to Wind Information, when the Covid-19 pandemic disrupted trade. Imports from the U.S. dropped over 18%, and China’s trade surplus with America shrank by 41.55% year on year to $18 billion.

Overall exports rose 4.8% last month in U.S. dollar terms from a year earlier, customs data showed Monday, shy of Reuters’ poll estimates of a 5% jump.

Imports plunged 3.4% in May from a year earlier, a drastic drop compared to economists’ expectations of a 0.9% fall. Imports had been declining this year, largely owed to sluggish domestic demand.

That was largely offset by its shipment to the Southeast Asian bloc, which jumped nearly 15% from a year, and those to European Union countries and Africa, which rose 12% and over 33%, respectively.

The article concludes:

While noting that it took time for the recovering demand to feed through to actual shipments, Huang cautioned that the existing tariffs are unlikely to be reduced further, if not hiked again, and will lead to slower export growth by year-end.

Chinese Vice Premier and lead trade representative He Lifeng is expected to meet with the U.S. trade negotiation team led by Treasury Secretary Scott Bessent in London later in the day for renewed trade talks.

The second-round of meetings come after tensions flared up again between the two sides, as they accused each other of violating the Geneva trade agreement.

Washington had blamed Beijing for slow-walking its pledge to approve the export of additional critical minerals to the U.S., while China criticized the U.S. decision to impose new restrictions on Chinese student visas and additional export restrictions on chips.

China’s Ministry of Commerce said on Saturday that it would continue to review and approve applications for export of rare earths, citing growing demand for the minerals in robotics and new energy vehicle sectors.

The trade negotiations are needed by both countries. Neither America nor China has a totally winning hand. We need China’s rare earth minerals, and China needs the American markets. There is some major unrest in China among workers as manufacturing slows in reaction to declining exports to America. I also expect that there will be some grumbling among Americans who may (at least temporarily) be paying higher prices for some products.

The Myth Of Green Energy

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Yesterday John Hinderaker at Power Line Blog posted an article about the feasibility of achieving 100 percent green energy.

The article notes:

High on the Left’s agenda is mandating 100% “green” generation of electricity–if not 100% of energy, period. I believe Joe Biden, among others, has now come out for 100% “green” energy, meaning wind and solar. But for now, let’s stick with energy generation. Would it be feasible to get 100% of our electricity from wind and solar?

Basic problems with these energy sources include inefficiency and intermittency. Wind turbines produce energy around 40% of the time, and solar panels do much worse than that in many parts of the country. So how does a utility ensure that the lights will go on, even at night when the wind isn’t blowing?

The liberals’ favorite answer is “batteries.” Produce electricity when the wind is blowing and the sun is shining, and store the energy in batteries for use when electricity is not being generated. Batteries exist, of course; we use them all the time. But where is the battery that can store the entire output of a power plant or a wind farm? That battery does not exist. Further, battery storage is ruinously expensive. The cost of storing the entire electricity needs of the U.S. for even a day would be prohibitive.

But there are also other problems in terms of the materials required.

The article notes:

But that isn’t the worst of it. Wind and solar are low-intensity energy sources. It takes many acres of wind turbines to produce, on a best-case scenario, what a single power plant can produce. And solar panels are even worse. A single 3 mw wind turbine uses 335 tons of steel, 4.7 tons of copper, 3 tons of aluminum, 2 tons of rare earth elements, and 1,200 tons (2.4 million pounds!) of concrete. If we take seriously the idea of getting all of our electricity from wind and solar, where will all of those materials come from?

The article links to another article at Center of the American Experiment that explains how much metal would required in just Minnesota to implement the Green New Deal. Please follow the links above to read both articles. They are enlightening.

The article at Power Line Blog concludes:

The Democrats’ “green” agenda does not represent a set of meaningful policy proposals. Taken seriously, and objectively evaluated, they immediately crumble. It is literally true that the Democrats could propose to harness the energy of unicorns running on treadmills, and it would make as much sense as reliance on wind, solar and batteries. “Green” energy is driven by two closely related things: 1) politics, and 2) enormous quantities of money being made by politically-connected wind and solar entrepreneurs.

We need to use energy wisely and we need to do what we can to prevent pollution. But we also need to remember that as cultures become more advanced, those advancements tend to result in cleaner air and cleaner water. Many of the rivers and lakes in America are cleaner than they were 100 years ago because of scientific advancements in sewage treatment and manufacturing. We are capable of protecting the environment and also enjoying the fruits of civilization.

Great News For America

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Energy independence is wonderful, but in today’s technology age, there are other important areas where America needs to be self-sustaining. One of the them is the rare earth minerals used in the manufacture of our technology. On Wednesday (updated yesterday) The Epoch Times posted an article about one step that has been taken in this direction.

The article reports:

Owners of the Wheat Ridge facility for processing rare earth elements and critical minerals have received an operating permit that will enable minerals critical to advanced technology manufacturing to be mined and processed in the United States.

USA Rare Earth, LLC, and Texas Mineral Resources Corp. announced on June 18 that their Wheat Ridge, Colorado, facility has received its operating permit, with its pilot plant now in the commissioning process.

Texas Mineral said in a press release that the plant “will have the ability to produce the full range of high purity, separated rare earths as well as other critical minerals … which are essential for modern manufacturing ranging from defense applications to wind turbines, electric vehicles, smart phones, advanced medical devices, and the physical backbone of emerging 5G networks.”

The company says its objective is “to build the first rare earth and critical minerals processing facility outside China.”

The CEO of USA Rare Earth, Pini Althaus, said in a press release that the establishment of an independent, robust, and domestic rare earth metal and critical mineral supply chain is vital for the United States, “overcoming reliance on China.”

Congress and President Trump have both recognized the need to produce these minerals in America.

The article notes:

Reps. Michael Waltz (R-Fla.) and Paul Gosar (R-Ariz.) introduced legislation (pdf) on May 28 to protect American mineral supply chains.

Gosar described critical minerals as the building blocks of our modern lives, as they are vitally important for special components in defense systems, health care applications, and energy generation technology.

“For years, our country has become increasingly dependent on China and other nations to fulfill our demand for minerals,” said Gosar. “The global pandemic has demonstrated the severe consequences of allowing this longstanding over-reliance on China to go unchecked.”

Waltz said that critical minerals are integral to our way of life.

“As coronavirus has unfortunately demonstrated, if China can threaten to cut off our pharmaceutical supply, they can do the same with their supply of rare earth minerals,” said Waltz. “We need to bring this supply chain back to America—and this bill will be an important step to do that.”

…President Donald Trump issued Executive Order 13817 in December 2017, titled “A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals.” The order directed federal agencies to list critical minerals, develop strategies to reduce reliance on the minerals themselves and on foreign suppliers, and increase domestic production.

The positive impact of the coronavirus is that it reminded us that as a nation we need to be as self-sufficient as possible. It is encouraging to see steps being taken in this direction.