China Halts Shipments to U.S. of Tech-Crucial Minerals
From LiveScience by Jeremy Hsu
A nasty trade dispute appears to have prompted Chinese customs officials to block shipments of rare earth minerals to the U.S.
The move underscores a deepening U.S. vulnerability because of its dependence upon China for tech-crucial rare earth minerals (also known as rare earth elements). Small but significant amounts of the minerals go into creating everything from PCs and cellphones to wind turbines and hybrid cars, as well as U.S. military technologies such as missile guidance systems.
This latest news came from three rare earth industry officials cited by the New York Times. The officials spoke on the condition of anonymity for fear of backlash from China.
China currently controls about 97 percent of rare earth production.
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U.S. rare earth companies have begun looking to reopen old mines and search for new deposits, but industry experts say that relaunching an independent U.S. supply chain could take 15 years.
The latest Chinese action follows a similar move last month, when China halted shipments to Japan during a political dispute over Japan’s arrest of Chinese fishermen. Among the affected Japanese companies was Toyota, maker of the popular Prius hybrid cars which incorporate the rare earth element neodymium, among others.
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So the big green quandary is: Prius, or practice what you preach and do without?
Addendum – This license plate I photographed on California’s Interstate 5 back in 2008 may prove prescient:
Hey! I’ve got a great idea! Let’s spend capital we don’t have to pursue a technology that makes us dependent upon a communist nation! What? You ask where will we get the money? We’ll just pass laws that takes it from the workers in this country! Then, our HOPE will transform into CHANGE! Lunatics running the asylum.
Well this is interesting. To be honest nobody has shot themselves in the foot. Look at the growth curve for China. They will need all they can mine plus some more. Just like with oil. Remember that one? China was an EXPORTER of oil not so long ago (or maybe I’m just so old I remember that 🙂
So now they will keep their REE mined from their enviro-freaking-disaster mines to use internally. The rest of the world will have to adapt and pay more $$$ regardless of the source (China or alternate).
So China says “we’re keeping more” which will drive the price up and they will make the same amount from their export making their domestic supply essentially free (not to the end users of course!).
The real battle will be the bidding war for the REE from places that can get their mines online the quickest. China will be there, count on it!
The USA gives a trillion to a bunch of banksters who should be locked up for epic fraud and China spent 600 billion on infrastructure. Hmmm I wonder who got the best of that deal? Don’t underestimate your opponent. Keep your supply lines protected and all that great Art of War stuff.
Cheers
Mr. Sexton,
You’d have more credibility if you had been fulminating with good old tea party rage when our previous president was using stimulus packages like mad (I remember the checks he sent us so we could spend more), waging an expensive, elective war without paying for it (and not even including it in the budget). Where were you and the rest of your comrades then? Did you call our previous president a socialist, fascist-leaning communist?
Whoooeee is James Sexton getting excited or what. And he had the nerve to counsel Raving on his ranting. That was a hoot. Actually I enjoy reading both James Sexton and Raving so dont you guys take this as a discouraging word. I love it blunt and cryptic, Im rolling here cant get up for laughing.
Owen says:
October 21, 2010 at 7:27 pm
Sis, don’t think I wasn’t “fulminating”. It was wrong headed then, it has taken to an extreme failure now. An”expensive, elective war”? RU serious? You’ve checked the expenditures of both wars compared to the last 2 years? Here’s something to ask. If the check scheme failed, why, why on God’s green earth would we exponentially increase the failure? Why, also, would anyone decide to send the money overseas? How in the fck would anyone consider this beneficial to the U.S.? You want to bash GW for cutting checks? That’s fine and deserved! Does that excuse exponentially raising the lunacy and sending the money elsewhere?
And, just to be clear, I wasn’t limiting my insinuations only to our president. The fact is, I think he had no clue about where the necessary materials came from. I’m quite certain of this. This would be why he doesn’t release his scholastic history.
But, what else I’m certain of, is that it was stated plainly and clearly the rare earth materials would and did come from China. Even on this website it is referenced many times. Go to CNet. It is referenced there many times. It was plainly known to anyone that cared to know. Foreign dependence my A$$. This was entirely purposeful, playing on the buffoonery of dolts.
And you’re going to bring up a $500 check cut to tax payers? I’d say, regardless of how they spent it, it was better spent then. Or, maybe you prefer dependence upon a communist country as opposed to a capitalist one?
Here’s an idea. Why don’t we open our mines and extract our own materials and drill our own oil? Yeh, real radical idea, I know.
Why don’t we make it a law that any steel milled for a windmill must be done by a U.S. steel company? Or an oil rig? Or a gas well? Any rare earth material for solar panel must be from the U.S.? Is it more acceptable for the environmentalist that it comes from China? Or Saudi? Do they believe China and Saudi Arabia or Venezuela regard the environment more than the U.S.? Is this the position of the alarmists?
I am a citizen of a country that is neither USA nor China.
My country both exports and imports a substantial part of our economic activity.
We are part of the world community.
We are inevitably co-dependent with the rest of the world.
The USA and China are both huge and powerful.
However you too are not, and can never be independent, if you do not wish to live in poverty.
If you doubt that, ask yourself how many jobs would there be if foreigners did not buy your goods or loan money to you to keep your banks from bankruptcy?
Relax – take it easy and welcome to reality.
AusieDan says:
October 21, 2010 at 8:38 pm
Ausie, I was going to respond to johnmcguire, however, yours is a more meaningful statement. I know many will take my response in a manner not meant. But, I think it should be said.
Poverty is defined in many ways. I define prosperity as having the general ability to provide the basic necessities for ones family and the ability to gain more if one desires. In today’s modern society, that includes housing, food, clothing, heating, cooling, and communication. If a nation was to generally be able to provide these necessities to the populous, then it would be difficult to state they were in a state of poverty.
You said, “The USA and China are both huge and powerful. However you too are not, and can never be independent, if you do not wish to live in poverty.”
You are partially correct. Both the USA and China are both huge and powerful. I submit, though, the U.S. can be(though not unique to the U.S.) independent. There is no resource, necessary to the above mentioned, in which the U.S. cannot provide for themselves. In fact, the U.S. (and other nations) would be more prosperous if they chose to do for themselves what they are having others do for them. More, if we were to engage in such matters, we would find an abundance in which others would find necessities.
I smell a well planned ruse. How amazingly easy it is for the propaganda mills to incite so many to a near war footing at the drop of a hat. (Grab your saber — someone has shot the archduke. )The biggies in all countries must continually pat themselves on the back for their ability to enrich themselves by wars where literally millions might die — except none of them. Wink. Wink. Nod. Nod.
Rare earths have no preference for China. They are not concentrated in extreme amounts like tin, silver, iron, nickel, etc. They are fairly evenly distributed. In fact it is likely that America could revive its industry and lead the world in a couple years simply reprocessing tailing from tin (which America has preciously few) mines, gold , lead , and zinc mines. Rare earths require effort, not extreme concentrations which would be so unusual as to be a scientific curiosity. But environmental laws no longer allow it. It is another business sent to China. Like light bulbs.
I just thank God every day for the complete and total economic collapse of the US that is now a mathematical certainty.
China and the rest of the world should cut dead beat America off from all trade with them.
It will be nice when we can make bicycles, toasters, microwaves, printers, TVs, and all the other consumer stuff we want to buy, right here in the USA again.
James Sexton says:
October 21, 2010 at 8:35 pm
“Why don’t we make it a law that any steel milled for a windmill must be done by a U.S. steel company? Or an oil rig? Or a gas well? Any rare earth material for solar panel must be from the U.S.?”
Because we would lose by causing wasteful capital investment in the US, and by losing a low cost source of raw materials when China removed its restrictions (as it inevitably would). China would lose the US as a customer for these materials. Much better to determine with the Chinese exactly what the problem is and plan a solution, possibly involving US capacity. Hopefully it will become apparent that a continuing embargo is a lose – lose proposition. Only when the situation proves intractable for some reason should trade restrictions be reluctantly considered. It would feel good to produce all of our own oil and not buy from the Middle East, but would it really be the best thing to do?
BTW, there’s your reality, Dan.
tj says:
October 21, 2010 at 9:19 pm
“….How amazingly easy it is for the propaganda mills to incite so many to a near war footing at the drop of a hat. (Grab your saber — someone has shot the archduke. )…..”
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No one is even close to that extreme, nor would any rational person propose such insanity. Has there been some manipulation? Sure, it seems fairly plain that there has been, or at the very least, political expedience in lieu of national good.(for many nations) It is for the various people to root out the Quislings from being decision makers, held up for ridicule and scorn and proceed.
pochas says:
October 21, 2010 at 9:27 pm
James Sexton says:
October 21, 2010 at 8:35 pm
“Why don’t we make it a law that any steel milled for a windmill must be done by a U.S. steel company? Or an oil rig? Or a gas well? Any rare earth material for solar panel must be from the U.S.?”
Because we would lose by causing wasteful capital investment in the US, and by losing a low cost source of raw materials when China removed its restrictions (as it inevitably would). China would lose the US as a customer for these materials. Much better to determine with the Chinese exactly what the problem is and plan a solution, possibly involving US capacity. Hopefully it will become apparent that a continuing embargo is a lose – lose proposition. Only when the situation proves intractable for some reason should trade restrictions be reluctantly considered. It would feel good to produce all of our own oil and not buy from the Middle East, but would it really be the best thing to do?
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I suppose it depends on ones perspective. You are entirely correct when you state, “…losing a low cost source of raw materials when China removed its restrictions…”.
However, as we’ve witnessed today, when we do such business ventures, we become beholding to this nation’s(China) policies. Further, at what point would you decide that it becomes too costly to buy from this nation? Are there guarantees in which we should bank on from them? Do you remember when certain Latin American nations nationalized their oil? The same happened to other nations.
I ask you, was it better for the U.S. that we invested, developed and operated the oil wells only to have it taken from us? Would the money have been better spent developing better and more efficient ways to extract our own resources? Be it oil, coal, gas, wind, solar…etc… How much further could we have been?
pochas says:
October 21, 2010 at 9:27 pm
James Sexton says:
October 21, 2010 at 8:35 pm
Because we would lose by causing wasteful capital investment in the US, and by losing a low cost source of raw materials when China removed its restrictions (as it inevitably would).
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You do realize you are describing what benefits individuals, not tied to a society, as opposed to benefiting a nation from which the “capital” came from? In other words, you are describing the export of capital! Yes, that helps the person(s) that engages in such actions. But, only them. Thanks.
Chinamerica?
(crickets chirping)……..To the pedants, cynics, and others of an entirely different character. That’s what I thought!
It is an outrage that we are in this position. It is an outrage that people have willingly put us in this position. To the ones that knowingly put us in this position, there isn’t a………….
Nigeria has REE’s but these are dug from hand excavated scrapes in the ground so quantity is a problem. I am sure that there are areas of US and Canada where REE’s can be found. Come on you geologists get your hammers and start searching. Australia also has REE’s so ask them in the mean time.
Never mind rare-earths, if China stopped shipping goods the UK would be without any products whatsoever, especially electricals.
At present we make … umm … and some … umm … and a little …. umm ….
Ah, I know. We make coloured pieces of paper with the Queen’s head on them, and give them to China in return for everything we consume.
.
The watermelons like moral and political extortion. I wonder how much they like it now the game has turned against them?
I love the license plate photo! A US trader speaking on condition of anonymity for fear the Chinese might cut him off from rare earth metals saying the Chinese have cut him off from rare earth metals isn’t exactly a confirmation or even a reliable source, if you see what I mean.
Another thing to consider: Greenland, where George Soros allegedly believes global warming will uncover significant rare earth deposits now locked into the ice (rather than locked into bedrock, which is so much easier to cut through than ice).
Please, people, don’t be so gullible. This is supposed to be a sceptical blog! There is no evidence that China has imposed any sort of blockade on the US, and they flatly deny having done so. All we have is an anonymous claim from alleged industry “officials” with an axe to grind. Such a blockade is most unlikely to have occurred, because it would be contrary to China’s interests, and Chinese politicians are not as idiotic as American ones. It is however quite likely that the export price has risen and the export quantity fallen as Chinese domestic demand has increased; this would be normal market economics. US “retaliation” against China would be very bad news for the US government, because if China can’t sell to the US it won’t have the dollars to lend them back.
“Raving says:
October 21, 2010 at 1:25 pm
Lol. The Yanks get screwed by way of their own self serving free enterprise dogmatism.”
You really have a flawed understanding of free enterprise and why we’re reliant on China for these materials.
“RockyRoad says:
October 21, 2010 at 1:58 pm
Good luck producing any REE from future mines here in the US–I quit the mining business largely because of the difficulty in getting signoff from the vast number of competing jurisdictions–often complying with one put you out of compliance with another. It will probably take a literal Act of Congress to get sufficient supply of these minerals here domestically.”
That whole ‘act of congress’ thing’s going to get a lot easier in about 12 days.
JimB
Paul Birch says:
October 22, 2010 at 3:12 am
Please, people, don’t be so gullible. This is supposed to be a sceptical blog! There is no evidence that China has imposed any sort of blockade on the US, and they flatly deny having done so.
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Whether the have or haven’t isn’t really the issue. The alarmists have put the U.S.(and many other nations) in a position quite similar to U.S.’ position with OPEC. All in the name of a Quixotic venture they were told wouldn’t work to begin with. Our politicians are culpable. The question isn’t whether China did or didn’t do anything, the question is why have people intentionally put us an a position to care?