Wednesday, January 12, 2011

Will Mainland China Make Rare Earths Even Rarer?

As Beijing decides to secure their own strategic supply of rare earth metals would this result in making rare earths even rarer?


By: Ringo Bones


Even though the literal “rarity” of rare earth metals is a misnomer – the rarest one is only slightly rarer than iodine – recent geopolitical developments in Mainland China and the surrounding region might possibly make the oft-perceived rarity of rare earth metals a “literal” possibility in 2011. As of January 6, 2011, the Beijing government has decided to reduce their rare earth metal export quotas by 35% for the whole of 2011.

Beijing’s decision recently became another concern for Japan’s very rare earth metals dependent high technology manufacturing sector which provides virtually all of the world’s supply of electric motors for hybrid cars, video display panels and other newfangled systems to generate electricity in an environmentally-friendly manner. Beijing’s recent decision to curb rare earth metal export quotas has even spurred on Japan to further step-up their own on-going seabed exploration in the search for commercially viable rare earth metal ores.

Even though Mainland China currently supplies 97% of the world’s rare earth metal needs, their need to secure their own strategic supply of rare earths has recently become an inevitable necessity after recently becoming the world’s number one manufacturer of wind turbines and plans to build scores of nuclear fission power plants in order to reduce their overall greenhouse gas emissions. Looks like other countries with commercially viable rare earth ores in their territories has now got a very good reason to step-up their own rare earth metal mining and processing industry given the People's Republic of China's decision to reduce their 2011 rare earth export quotas by 35%.

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