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American Resources Policy Network
Promoting the development of American mineral resources.
  • Free Markets Alone Will Not Solve REE Crisis

    In a new piece for Defense News, Jeffery A. Green, president of J. A. Green & Company and a member of the ARPN panel of experts, takes exception to a recent opinion piece by the Wall Street Journal’s editorial board on the current rare earth crisis.

    The opinion piece had argued that the situation wasn’t as dire as many analysts and commentators made it out to be, and that markets alone could solve the issues surrounding China’s dominance. According to Green, this is not only a misguided position, it represents a “counternarrative” that has “stifled the development of a complete rare earth supply chain over the last decade, and will only scare and confuse the government and markets going forward.”

    He says:

    “Unfortunately, the editorial glosses over China’s ability to cut off supplies; provides misleading information on China’s current and future involvement in rare earth production; inappropriately argues the U.S. can meet its defense needs in the event of an embargo; offers a knee-jerk assessment of rare earth mining and processing as environmentally destructive; and ignores the national security implications of an entirely market-driven approach.”

    Green outlines four areas in which he believes the WSJ Ed board misses the mark:

      1. While the editors claim that China’s REE production is “on the wane,” the actual decline only amounts to a “small decline in their dominance of rare earth oxide production.” China continues to dominate — and in some cases is near a total production monopoly when it comes to “critical downstream capabilities required to bring products to market, such as rare earth metals, alloys and magnets.”
      2. The U.S. cannot, in fact, meet all DoD rare earths needs in the event of supply chain disruptions, because “many key elements of U.S. defense systems rely on rare earth materials that are in short supply, or unavailable, outside of China.”
      3. The editors suggest that domestic rare earth mining and processing would be harmful to the environment, but that idea is “misguided.” One must keep in mind that the U.S. is home to the “most highly regulated and environmentally friendly rare earth mine in the world” relying on technology and processes that could be “replicated as the domestic market expands.”
      4. Previous attempts to let the market solve issues surrounding the rare earths supply chain have “failed miserably,” and wrongly assumed that Beijing would play by the rules governing a free and fair market system — an assumption that has been proven wrong.

    Citing recent developments in Washington, DC, including President Biden’s recent executive order on securing critical supply chains and the House Armed Services Committee announcement of a bipartisan task force to investigate critical supply chains, Green says that it seems that fortunately, government has realized the need to act and invest.

    Green closes in invoking noted 18th century economic theorist Adam Smith – dubbed the father of the free market by some – who noted that market rules don’t apply to national security. Smith was quite clear in his take that “it might not always be prudent to depend upon our neighbors for the supply.” The materials Smith referred to were certainly different at the time – sailcloth and gunpowder – but their strategic relevance at the time is comparable to the relevance of REEs today.

    Green concludes:

    “[L]awmakers and members of the administration must not be fooled by an entirely free market approach that ignores forces larger and more powerful than the invisible hand. Meanwhile, China’s intention to achieve economic dominance across the globe will not cease or bend to market forces (see the Made in China 2025 initiative), which requires an explicit strategy to safeguard America’s interests.”

    Read the WSJ Ed board’s original take here (subscription).

    And for more on our nation’s REE conundrum, see here.

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  • China’s Saber-Rattling over Rare Earths Card Getting Louder

    After months of rumblings, it appears that China is gearing up to play its “rare earths card” again.

    Citing people involved in a government consultation, the Financial Times reports that Beijing is gauging exactly how badly companies in the United States and Europe, including U.S. defense contractors, would be affected by plans to restrict exports of rare earth elements.

    According to Chinese media, REE exports had already dropped by more than 20 percent following the passage of a new broad export control law restricting sales of items relating to Chinese national security that went into effect on December 1, 2020. The Ministry of Industry and Information Technology has since proposed more specific language to impose controls on REE production and exports.

    The development ties into the overall context of a deterioration of Chinese-American diplomatic and trade relations against the backdrop of the ongoing coronavirus pandemic, with the buildout of 5G technology having emerged as a new frontier in the deepening tech war between the two global players.

    With China controlling more than 70% of global REE output, the specter of China weaponizing its position — yet again — is a serious threat to our national security and economic wellbeing. This is especially true when one considers that, while crucial, rare earths are only the tip of the proverbial iceberg when considering our overall critical mineral resource dependencies — a fact for which USGS has just provided the annual reminder with the release of its Mineral Commodity Summaries 2021, which lists China 24 times as one of the major import sources of metals and minerals for which our net import reliance is 50% or greater.

    2020 has underscored the urgency of shoring up our domestic critical mineral resource supply chains, and has yielded important progress with regards to policies aimed at reducing our over-reliance on foreign, and especially Chinese metals and minerals.

    While the Biden Administration is — understandably — reviewing the preceding Administration’s policies, it is important that stakeholders realize that we can’t admire the problem anymore. We don’t have the luxury of time.

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  • Time for Well-Thought-Out Yet Decisive Action to Diversify Our Critical Mineral Supply Chains

    Against the backdrop of the ongoing coronavirus pandemic, which has served as an eye-opener to many Americans with regards to our critical mineral resource dependencies, U.S. Secretary of Energy Dan Brouillette calls for strong U.S. action to secure our “most critical supply chains” in a new piece for The Hill. Arguing that “predominantly through research and development, [...]
  • A Mineral Resource Policy for 2020 – New Year’s Resolutions for Resource Policy Stakeholders

    We realize that New Year’s resolutions are somewhat controversial.  Some say, they‘re not worth the paper they’re written on – but we feel that whether or not we implement all of them, they offer a good opportunity to both step back to reflect and set goals as we look at the big picture ahead. And that [...]
  • 2019 in Review – Towards an “All-Of-The-Above” Approach in Mineral Resource Policy?

    We blinked, and 2020 is knocking on our doors. It’s been a busy year on many levels, and mineral resource policy is no exception. So without further ado, here’s our ARPN Year in Review. Where we began: In last year’s annual recap, we had labeled 2018 as a year of incremental progress, which had set [...]
  • China’s Grand Strategy to Exploit United States’ “Soft Underbelly” Goes Beyond Rare Earths

    Much is being made of China’s recent threats to cut off Rare Earth exports to the United States, and the issue has – finally – helped bring the issue of mineral resource policy reform to the forefront.  However, as Ian Easton, research fellow at the Project 2049 Institute and author of The Chinese Invasion Threat, [...]
  • Podcast: ARPN’s Dan McGroarty Discusses U.S.-Chinese Trade Tensions Over REEs

    As the world looks towards Osaka, Japan, where world leaders will gather for the 2019 G20 Summit and Ministerial meetings later this week, former Missouri Speaker of the House Tim Jones discusses the current trade conflict between the United States and China and the implications of the looming supply disruptions for U.S. domestic industries as [...]
  • Global Times: REE Supply Restrictions Likely for U.S. Military Equipment Firms

    The specter of China playing the “rare earths card” is looming larger this week.   According to the Global Times’s twitter feed, U.S. military equipment firms will likely face restrictions of Chinese Rare Earth supplies in the near future, as China’s economic planners will “study and roll out policies on rare earths as soon as possible.”     [...]
  • Resource Alert:  North of 60 Mining News Has Launched “Critical Minerals Alaska” Magazine and Dedicated Webpage

    Over the past few weeks, China’s threat to play the “rare earths card” has generated quite a buzz and, along with growing concerns over supply chains for battery tech, has directed much-needed attention to our nation’s over-reliance on foreign mineral resources.  As followers of ARPN know, many of these issues are in fact home-grown, as the United [...]
  • CBS’s 60 Minutes Airs Updated Rare Earths Segment Featuring ARPN’s McGroarty

    Bearing testimony to the significance of the looming specter of China playing the “rare earths card,” CBS’s 60 Minutes this weekend aired an update to its 2015 segment on rare earths featuring ARPN principal Dan McGroarty.  You can watch the segment on the CBS website, which also features a written transcript. There is hope that the [...]

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