USGS

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 a drop of China’s market share from 98 percent to 86 percent last year.

However, a recent article in the British daily The Telegraph argues that this response may be too little, too late, and that this new production is not enough reason for manufacturers relying on Rare Earths to breathe easier:

“(…) even if China’s stranglehold on production of the raw elements is challenged, analysts warn that a more significant hold on the market remains unabated.”

The problem, as the article points out, is not that China has a monopoly on the resource itself – although being home to roughly 36 percent of the world’s reserves itself is not insignificant. China’s main advantage here lies in the fact that, having established world-leading processing facilities and the ability to manufacture, it has a monopoly on the process:

“The thing to remember is that China’s goal in offering state support to its home-grown rare earths industry was much broader than just digging and processing ore, says Kieron Hodgson, mining analyst at Charles Stanley.

Beijing, instead, was aiming to build a value chain, where by the rare earths are dug up, processed, and then incorporated into end products.”

According to the piece, the United States’ saving grace may be that “it has enough resources to start an industry.” Whether it will be able to succeed in doing that remains to be seen, but in any case, the developments in the Rare Earths field hold a cautionary tale for policies towards other critical minerals and should be reason enough for policy makers to focus on devising a comprehensive critical minerals strategy.

In her latest piece for ProEdgeWire, Robin Bromby suggests that Tellurium may well be the newest critical metal. Citing two “throwaway lines” from recent reports and media reporting which indicate increased demand for the metal, Bromby goes on to give reasons why Tellurium should be placed on observers’ critical metals watch lists:

“Tellurium is vital to thin-film cadmium-tellurium solar cells. The report from the South Africa conference noted that if the world suddenly steps up solar energy development, there could be a squeeze on tellurium, citing the figure quoted by Murray Hitzman of the Colorado School of Mines that the U.S, would need 400 tonnes of tellurium for every gigawatt of solar energy, and the known world availability was just 48,000 tonnes (although the U.S. Geological Survey cites 24,000 tonnes — but that takes into account only tellurium contained in copper deposits; after all, some 90% of tellurium used is now recovered from slimes following refining of copper).

The USGS also notes that several materials — including bismuth, calcium, lead, phosphorous, selenium or sulphur — can substitute for tellurium but with loss of efficiency and product characteristics.”

Thus it comes as no major surprise that, as one of the throwaway lines cited by Bromby points out, a solar company has asked geologists to “go out and find [T]ellurium to meet projected needs.” ARPN’s Dan McGroarty must have been on to something when he asked in 2011 “Is Tellurium the ‘new gold?’”

The catch with Tellurium, however, is that you don’t just go out and mine it; the metal is largely a by-product of refining Copper, or, to a lesser extent, Lead and Gold. In other words, as we have argued in our 2012 report “Through the Gateway: Gateway Metals and the Foundations of American Technology,” it is a specialty metal unlocked by the “Gateway Metal” Copper.

With the possibility of supply shortages on the horizon, the example of Tellurium underscores how our mineral resource dependencies stretch beyond well Rare Earths.

In theory, remedies may be easy to come by. “The U.S. is home to more than 5 percent of global [copper] reserves, but U.S. mine production only accounts for 0.16 percent of global reserves — or 3.2 percent of U.S. reserves respectively.”

The Pebble deposit in Alaska, for example, could unlock vast amounts of both Copper and its derivatives for domestic and international use. Meanwhile, this project, which could yield historic amounts of critical minerals, has been met with fierce (and possibly precedent-setting) opposition by anti-mining activists who are calling for a preemptive EPA veto. If you missed Dan McGroarty’s piece in the Wall Street Journal on this complex issue, read it here.

Meanwhile, harnessing our vast domestic mineral potential is not just a good idea, it’s a necessity. As we argue in our Gateway Metals report:

“As both gateway and tech-metals are critical to U.S. commercial manufacturing, green-energy development, technological innovation, and advanced weapons systems, America cannot maintain its modern economy without a steady supply of these key metals and minerals. In a very real sense, these metals are the “gateway” to our future economic, technological and military strength.”

Alaska Attorney General Daniel S. Sullivan gives an account of the state of the Parnell Administration’s five-part strategy to support the mining industry in a column for Petroleum News. This strategy, which was unveiled at the September 2011 Strategic and Critical Minerals Summit, comprises the following components: Undertaking a statewide assessment of strategic minerals; Providing [...]

Inquiring Congressional minds want to know — or at least the Congressional mind belonging to Rep. Hank Johnson (D-Ga.), co-chair (with Colorado Rep. Mike Coffman) of the newly-formed Rare Earths Caucus. During Defense Secretary Leon Panetta’s House Armed testimony this week, Cong. Johnson seized the opportunity to ask where things stood with the Pentagon’s report [...]

The United States Geological Survey announced that it has granted more than $260,000 for “new research on mineral resources important to [US] economy, national security, and land-use decisions,” including rare earths, niobium, and tantalum.

With this week’s WTO ruling on China’s raw materials exports (visit RareMetalBlog for our very own Daniel McGroarty’s take) all eyes are once again on rare earths – and for good reasons, as these critical elements are the poster child of the challenges associated with resource dependency. However, a broader focus is needed, and tungsten [...]

Bearing testimony to the fact that China’s geopolitical power play stretches beyond rare earths elements, around which its restrictive export policies were centered in recent months, China has announced it is going to cut export quotas for other specialty metals as well.   According to Nasdaq, Beijing’s China Daily News and the Rare Earths industry journal have [...]

Another example of what happens when one country dominates supply of a resource, California-based phosphor maker Intematix, relying on rare earths to produce phosphors used for fluorescent light bulbs and white LEDs, has decided to move some of its manufacturing to China.  The news comes on the heels of Japanese metals fabricator Showa Denko announcing [...]

If you’ve had to replace a light bulb in your home lately, then you have may have noticed that the price for lighting has gone up significantly. The reason behind the price hike is two-fold: 1) recent legislation that passed, mandating the phasing out of the light bulb as we know it, and 2) the current [...]