After China’s Rare Earth Embargo, a New Calculus

Reporting from Baotou, Keith Bradsher of the New York Times writes on the rare earths situation on the ground in China, in light of the recently lifted trade embargo:

China feels entitled to call the shots because of a brutally simple environmental reckoning: It currently controls most of the globe’s rare earths supply not just because of geologic good fortune, although there is some of that, but because the country has been willing to do dirty, toxic and often radioactive work that the rest of the world has long shunned.

Despite producing 95 percent of the world’s rare earths, China has only 37 percent of the world’s proven reserves. Sizable deposits are known to exist in the United States, Canada, Australia, India and Brazil, among other places.

Many of those countries, responding to the rising demand for rare earths and alarmed by the recent embargo, are now scrambling to develop new mines or renovate ones long considered not to be worth the effort. That includes an abandoned mine in California that the American company Molycorp is trying to refurbish.

But experts say that any meaningful new production from outside China is at least five years away, and that it will come with its own environmental cost calculus.

Oiwan Lam at Global Voices covers bloggers’ debates:

In the new round of debate, blogger, exsoldier, also looks at the issue as international bullying of China. His blog title is “Foreign powers are pressuring China to export rare earths”. The blogger quotes a report, Rare Earth Elements: The Global Supply Chain (pdf) written by Marc Humphries, an analyst in energy policy, and points out that:

按人均储量算,美国和俄罗斯都要高于中国。而因为处于产业下端,中国以全世界三分之一的储量生产出占世界97%的稀土,储量和产量之间的关系出现了严重不 对等。而美国坐拥全球稀土资源的13%,却分文不动,百分之百地“依赖”进口。所谓中国限制稀土出口引起了一些国家稀土供应短缺的说法并不真实,应该说, 它们短缺的不是稀土,而只是中国生产的廉价稀土。

If we look at the reserve per capita, the rare earth reserves in the U.S and Russia are higher than China’s. However, because China is at the lowest level of the production chain, it produces 97% of the world’s rare earth elements. The ratio of reserve to production is totally out of balance. The U.S has 13% of the world’s rare earth reserves but it produces none and depends 100% on importation. Hence, it is not true to say that Chinese restrictions on rare earth exports have lead to the shortage of supply. Rare earth is never in short supply, it is the cheap Chinese rare earth that is in short supply.

October 29, 2010 6:41 PM
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