Rare Earth Elements

Rare Earth Elements attracted my curiosity because environmentalists constantly complain about the scarcity of raw materials and elements on the planet due to over-exploitation by greedy capitalists.

I am in agreement with Milton Freedman on the issue of greed: “Is there some society you know that doesn’t run on greed? You think Russia doesn’t run on greed? You think China doesn’t run on greed? What is greed? Of course none of us are greedy. It’s only the other fellow who is greedy. The world runs on individuals pursuing their separate interests.”

How rare are these rare earth elements? It turns out, the 15 elements called lanthanides are not so rare after all, some more abundant than copper, lead, gold, and platinum. They are just difficult to extract and release radioactive byproducts during mining that must be carefully disposed of and stored. The rare earth oxides and metals are used in catalysts, glass, polishing, metal alloys, magnets, phosphors, ceramics, medicine, batteries, engines, and defense.

The 15 lanthanides are: lanthanum, cerium, praseodymium, neodymium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, ytterbium, lutetium, yttrium, and scandium. These elements are divided into light rare earths which are more abundant (lanthanum through europium with atomic number 57-63) and heavy rare earths which are less abundant (gadolinium through lutetium with atomic numbers 64-71 and yttrium).

According to Dr. Klaus Kaiser, “Up until the mid-19th century, rare earths were just a chemical curiosity without much practical use. Then in 1885, the Austrian chemist Carl Auer von Welsbach (1858-1929) invented the cerium-containing "Glühstrumpf" (gas mantle) for kerosene-burning lanterns and, in 1903, the cerium-based flint. Both are still widely used today, the flint in such things as cigarette lighters, and the gas mantle in Coleman-type lanterns for camping.”  (http://EzineArticles.com/5732661)

March Humphreys, a specialist in energy policy, writes in the CRS Report for Congress of June 8, 2012, about some specific uses of lanthanides:

Lanthanum – hybrid engines, metal alloys

Cerium – auto catalyst, petroleum refining, metal alloys
Neodymium – catalysts in cars, refining of petroleum, hard drives in laptops, headphones, hybrid               engines
Praseodymium, samarium, and gadolinium – magnets
Europium – red color for television and computer screens
Terbium – phosphors, permanent magnets
Dysprosium – permanent magnets, hybrid engines
Erbium – phosphors
Yttrium – red color, fluorescent lamps, ceramics, metal alloy agent
Holmium – glass coloring, lasers
Thulium – medical x-ray units
Lutetium – catalysts in petroleum refining
Ytterbium – lasers, steel alloys
(Rare Earth Elements: The Global Supply Chain, Marc Humphries, p. 3 using as source the DOI, U.S. Geological Survey, Circular 930-N)

Fluorescent lamps, new generation generators for wind turbines, satellite and communication systems, and defense such as fighter jet engines, missile guidance systems, and anti-missile defense also use rare earth elements (REEs).

The supply of REEs is vulnerable since China holds a monopoly with 97 percent of rare earth elements output and 75 percent of permanent magnet production.

China’s production of REEs started in late 1950s in the Chinese area of Inner Mongolia, the Baiyun Obo iron ore deposit discovered in 1927. The mine covers 48 square kilometers and is estimated to contain 36 million tons of rare earth oxide. (Wayne M. Morrison and Rachel Tang, China’s Rare Earth Industry and Export Regime: Economic and Trade Implications for the United States, April 30, 2012)

The Chinese has a monopoly because the Chinese leader Deng Xiaoping made the exploitation of rare earth elements a top priority, likening its strategic significance to the importance of the Middle East’s oil.

China has used rare earths as a political bargaining chip. The New York Times reported on September 22, 2010 the incident between two Japanese and Chinese fishing vessels that collided in disputed waters. This collision resulted in the arrest of the Chinese captain by the Japanese and the subsequent temporary halting of exports of rare earth elements to Japan which China denied. (CRS Report for Congress, p. 31)

China denies using rare earth elements as a political weapon although it stated that it aims to control the rare earths for the world’s sustainable development.  “We are pursuing a sustainable development for the rare earth industry.” Where did I hear that before? It is now the platform of every agency of the U.S., state, and local governments that have adopted the UN Agenda 21 platform of sustainable development and green growth/smart growth - a way to control the global economy and ultimately our daily lives, private property, and bodies.

The second reason for a Chinese monopoly is the shutdown of the Mountain Pass mine (owned by Molycorp) in the United States in 2002. Two of the largest rare earth mines are the Mountain Pass mine in the U.S. and Mount Weld in Australia.

Rare earth deposits contain radioactive elements which must be separated and disposed of properly as toxic pollutants and hazardous waste materials. The Mountain Pass mine, operating at full capacity in the 1990s produced 850 gallons of salty wastewater per minute, containing radioactive thorium and uranium. This salty water was delivered 11 miles away where it was evaporated. The radioactive materials leeched into the desert sand when the pipes had to be cleaned and burst occasionally. The owner of the mine, Molycorp, a subsidiary of Unocal, was ordered by the state of California to clean up the waste. Molycorp ran out of space by 2002 to store the waste and failed to secure a permit to build a new storage facility. (CRS Report for Congress, April 30, 2012, Wayne M. Morrison, Rachel Tang, p. 3)

Chevron bought Unocal and thus Molycorp with its Mountain Pass mine in 2005 after the China National Offshore Corp., a state owned company, failed to buy Unocal due to political outcry that U.S. oil reserves should not be transferred to a corporation owned and controlled by the communist Chinese government. No mention was made at the time of Molycorp and the Mountain Pass mine. (CRS Report for Congress, April 30, 2012, p. 21)

Molycorp started processing stockpiled bastnasite concentrate and mining fresh bastnasite in 2011 to be processed into magnetic materials. However, since Molycorp acquired Neo Material Technologies, listed in Toronto, but with plants in China and Thailand, serving markets in China and Japan, it is doubtful that the acquisition would help United States interests. Instead, the deal would reinforce China’s dominance in rare earth elements production.

“China is the only country that can supply right now a significant amount of light and heavy rare earths, and is likely to remain the major supplier in the future.” Consequently, the price of Chinese rare earths imports has sky rocketed from $3,111 per metric ton in 2002 to $76,239 in 2011, a 2,432 percent increase. (CRS Report for Congress, p. 5)

Global production of REEs is 133,600 tons annually while demand has been estimated at 136,100 tons in 2010. (U.S. Geological Survey, Mineral Commodity Summaries, January 2011)

Foreign demand for rare earths from China has dropped, easing prices. Foreign demand decreased because many foreign manufacturers have moved to China, reduced their rare earth inventories, switched to alternative materials, or just cut production in order to avoid paying the extreme high prices. The Chinese took countermeasures by imposing new production regulations, exportation quotas, and exportation taxes on foreign manufacturers operating in China.

We love our cell phones, portable DVDs, laptops, electronic gadgets, rechargeable batteries for hybrid and electric cars, and medical devices. Once self-reliant in domestically produced REEs, in the last 15 years we have become 100 percent dependent on Chinese imports because of their lower cost operations and lack of stringent regulations. Now that they control production, the sky is the limit.

Analysts, who recognize how critical rare earths are to hundreds of high tech applications, know that, “without rare earth elements, much of the world’s modern technology which defines our modern way of life, would be vastly different, and many applications would not be possible.”