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posted by cmn32480 on Wednesday September 02 2015, @09:53PM   Printer-friendly
from the use-common-earths-instead dept.

MOUNTAIN PASS >> The only rare earth mining and processing plant in the Western Hemisphere is closing and virtually all of its nearly 500 person workforce is expected to be let go. Officials from Greenwood Village, Colorado-basedMolycorp, said earlier this week they will transition their massive San Bernardino County facility to a "care and maintenance" mode while it plans to continue serving its rare earth oxide customers via its production facilities in Estonia and China.
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Half a decade ago China produced some 97 per cent of the world's supply of rare earths. They thought it would be a cute idea to try and flex the monopolistic power they had. Not so much to try and get more for the raw materials: no, they wanted people to move rare earth-consuming businesses into China. There were export restrictions and high export tariffs on the raw materials but none at all on things that were made using them inside China and then exported.

So, for example, there's a subsidiary of Siemens out there that makes the lutetium crystals which power MRI machines. If you can't get that Lu (and that one factory consumes perhaps 90 per cent of global production) then you'd better move the factory to where you can, eh? Into China, that is. Certainly one company making the mercury vapour charges for light bulbs (which are doped with rare earths (REs) to change the spectrum of light from them), the world's largest producer of them by far, seriously considered restarting the factory inside China.

What happened then is the fun bit. The rise in the RE prices this caused meant that Molycorp and Lynas were able to gain financing to respectively reopen, and open for the first time, their mines. Not only that but they could do something vastly more expensive: set up the processing plants needed to do the complex separation of each RE from the others.

The point of the article is that China's attempt to abuse their monopoly power in rare earths has eroded their monopoly power. But the question of the strategic vulnerability that represents has not been answered...


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