American Resources Policy Network
Promoting the development of American mineral resources.
  • China’s growing love affair with Platinum and its implications for U.S. policy

    “It happens to all commodities. At one time or another, China falls in love with you and barring a drought or striking miners somewhere, your price becomes dependent on Chinese mood swings” – that’s the conclusion drawn by Forbes contributor Kenneth Rapoza, who zeroes in on China’s growing love affair with Platinum.

    An extremely rare metal – with a concentration of only 0.005 parts per million in the Earth’s crust – Platinum is not only one a valuable precious metal used for adornments, some of its key properties – ductility, durability, malleability and a very high melting point make it a sought-after component of a broad range of applications. One of its main uses is in the manufacture of catalysts used in diesel automobiles – an area where global emission standards are causing a “structural upward shift in demand for these auto catalysts and the platinum used in them.”

    Interestingly, one of the key areas of interest for the Chinese is not so much Platinum’s versatile application. As Rapoza argues:

    “Less well known, however, is that the largest single source of platinum demand over the past few years has been jewelry – and nearly all of that demand stems from the Chinese.”

    He raises several interesting points in his piece:

    • While catalysts used in vehicles accounted for the largest demand component for Platinum prior to the economic downturn in Europe, and was almost double the demand from Chinese jewelry, this ratio has been almost completely flipped. By 2012, Chinese jewelry demand had risen to nearly 2 million ounces (a 16% increase), and demand for auto catalysts in Europe had dropped to 1.3 million.
    • With Europe emerging from the recession, this demand will pick up again. Meanwhile, Chinese interest in Platinum as an adornment will likely continue to increase, as Platinum is increasingly the metal of choice for wedding bands.
    • An additional interesting development is the fact that “precious metals access in modern communist China has evolved from an almost illegal status to one that is actively encouraged by the state.”

    Meanwhile, as Visual Capitalist points out in part two of their outstanding three-part visualization of Platinum’s history, supply and demand and investment opportunities, the metal’s supply is largely concentrated in medium-to-high risk jurisdictions.

    The United States’ import dependency rate for Platinum presently stands at 91 percent. At the same time, Platinum has made the top tier of the American Resources Risk Pyramid in our 2012 Critical Metals report, underscoring its relevance to U.S. defense-related applications and proneness to supply disruptions.

    With China stepping up its role here again, this should serve as a reminder why the United States cannot afford to ignore this proverbial “800 pound gorilla” and would be well advised to devise a comprehensive critical minerals strategy.

  • Greenland’s mining decisions likely to refuel race for Arctic riches

    In what may become a groundbreaking decision, Greenland’s parliament has voted to lift a long-standing ban on uranium mining, opening the door to Rare Earths exploration and development in the Artic territory. A-semi-autonomous part of Denmark, Greenland is hoping this decision and the expected industrial boom will bring it closer to achieving economic and ultimately legal independence from Denmark.

    A separate decision to award London Mining PLC a thirty-year license to build and run a giant ore mine ties into the same overall context of attempting to “wean Greenland from Danish economic support,” and turning to new partners, including China – as evidenced by the fact that London Mining PLC is a British company that has worked with Chinese industry in the past.

    Not surprisingly, Investor Intel’s Robin Bromby has taken a closer look at China’s involvement in Greenland, which as we have argued, seems to see the territory as its key point of access to the Arctic’s vast mineral riches. Retracing a series of events that all but confirm China’s serious interest in opening that door to the Arctic (including its recent ascension to observer status on the Arctic council), Bromby says:

    “So this week we see a news report that says ‘China agreed with the Arctic Council that development in the Arctic region should abide by local regulations and environmental requirements, according to a senior official. China pledged to make a greater contribution through its new official observer role in the council, Jia Guide, deputy director-general with the Department of Treaty and Law under China’s Foreign Ministry, said Tuesday.’

    The Xinhua news agency quoted Jia saying “resource development in the Arctic was a possibility, but not a priority for China,”

    Oh really?

    It was diplomatic of Jia, speaking in Whitehorse, and then his stressing how important environmental protection was to his country.

    So we have [to] wait and see.”

    Indeed we will. The lifting of the mining ban is only a first step, and other laws may still have to be changed before any REE development can occur. Nonetheless, it is reasonable to expect that the above-referenced decisions will add some spark to the race for Arctic riches.

    As ARPN’s Dan McGroarty has argued, the United States’ claim to the Arctic comes via Alaska. His call to action from a few years back becomes all the more relevant as more and more players show up at the Arctic circle:

    “For the U.S., our Arctic claims come via Alaska – a.k.a. Seward’s Folly, and perhaps the best $7.2 million ever spent by the U.S. Government. Across a range of metals and minerals, expect Alaska – and by extension, our Arctic claims – to play a key role in resource supply in the 21st century. Forget the folly: let’s make that William Seward, futurist.”

    As indicated in a recent outline of the state of mining operations in Alaska by ARPN expert Curt Freeman, there is plenty of potential in The Last Frontier. Now more than ever would be a good time to unleash it.

  • Resource-hungry China continues its global quest for minerals

    While the fate of even first steps towards implementing a strategic minerals policy in the U.S. remains questionable, China is expanding its mineral resource footprint virtually all over the globe. According to recent media reports, Chinese companies have made forays into Sri Lanka looking for copper, zinc and aluminium suppliers. While this search was unsuccessful, [...]
  • McGroarty on The Hill’s Congress Blog: “The U.S. Government has it in its power to act now to close our “copper gap.”

    While China has taken steps to position itself in a “resource war that will increasingly define economic growth and national security in the 21st century,” the United States has subjected itself to a dangerous degree of import dependency for critical minerals – that’s the bottom line of American Resources Principal Daniel McGroarty’s new piece for [...]
  • Too little, too late? The West’s response to China’s REE stranglehold

    In an effort to challenge China’s near-total supply monopoly and the geopolitical power play that came with it, countries around the world have taken steps to seek alternative sources of supply. With new production coming online in the U.S. and Australia in recent years, along with small-scale production in India, U.S. Geological Survey figures document [...]
  • 3D Printing & the “New Rare Earths”

    “3D printing companies are the new Rare Earths.” Thus spake Twitter, a few hundred-million Tweets ago, giving birth to the new meme on what matters most in our constantly-evolving technology world. Meaning, of course, that the furor over Rare Earths sparked three years back — when China used its then-97% production monopoly as a weapon [...]
  • Why Tantalum should be on U.S. stakeholders’ radar

    Gearing up for their upcoming conference on conflict minerals in early May, our friends at MetalMiner are stepping up their coverage of Tantalum, one of the four minerals commonly referred to as conflict minerals, with the other ones being Tungsten, Tin and Gold. A recent MetalMiner guest post by Chelsea Craven of Zepol Corporation looks [...]
  • China and Brazil increase resource footprint in Africa

    Last month, the Huffington Post published a column discussing the growing footprint of two emerging powers in Africa – China and Brazil. China is a known quantity on the continent, and has been the “unequivocal leader in infrastructure development within Africa.” More recently, however, Brazil has accelerated its efforts and more than quadrupled investment to [...]
  • Antimony metal to be watched

    In a piece for DailyMarkets.com, analyst Jeb Handwerger zeroes in on Antimony. Antimony is a key component in fire retardants as well as batteries, ceramics, touch-screen technology, glass, and ammunition and has seen largely stable prices in unstable economic times. With China being its top producer controlling nearly 90 percent of global supply and other [...]
  • Calls for Greenland’s independence grow louder amidst differences with Denmark over resource extraction

    Bloomberg reports that “Chinese interest in Greenland’s mineral wealth is reigniting the Arctic island’s campaign to sever ties with Denmark after almost 200 years of colonial rule.” According to a February 24 story, calls for the territory’s independence are growing louder as Denmark, which controls Greenland’s foreign policy, opposes Greenland’s plan to cooperate with Chinese [...]