China's rare earth policy backs Apple into a corner Apple’s shiny fondleslabs are made in China not only because of the low cost of labour in the People’s Republic but also due to the surging prices and tightening export restrictions on rare earth minerals which the nation has a near monopoly on, according to a report. Although Apple has been notoriously secretive about the …
It's not getting worse. Molycorp and Lynas are both expected to bring large amounts of REO into production within the year, and the price of a basket of rare earth oxide prices (for use outside china) published by Lynas has fallen 75% from its August 2011 peak.
Whilst it is still double the intra-china price, added supply from the many projects due to come on line over the next 3 years should sort that out.
It's not a case of various transition metals (I don't like the idea of calling them 'rare earths' when some of them are actually quite common) becoming hard to find, but more a case of their becoming more expensive as China decides that the sort of environmental regulations that much of the rest of the world has are a good idea if you don't want your population to all get heavy metal poisoning. As they become more expensive to mine in China, it becomes economical to re-open mines in other countries. China loses its stranglehold on supply, production ramps up, prices peak and then settle at a slightly higher level than they are today.
As worker conditions and pay in China improve, it will become less economical to make stuff there too. As China becomes richer, manufacturing will move to a point closer to where the goods are being sold, as the cost of moving things around begins to outweigh the savings from making them in a less developed country.
There's loads of known and exploitable REE deposits elsewhere. They were the main source prior to the 1980's/909's when China brought theirs onto the open market at a fraction of the market price. Everyone else put their mines on hold, and used the China supply instead. This China lockdown has been on the cards for a while, and as such companies have been spinning up their old mines in preparation. The Chinese deposits are certainly large and rich, but they are by no means the only ones.
And why do you think that "spinning" them will succeed.
It is not economics which commands the price here - it is "world domination" planning. China _WILL_ play with prices to ensure that any such venture which is not "sponsored" by a government fails and will use the WTO every time we try to subsidise them.
That is the price we have to pay for admitting what is _NOT_ a free economy to the WTO.
I don't think the WTO could do anything if China really knuckled down. China has a surplus of the one thing the west would never consider expendable: people. China's can drive down the price because they're ready, willing, and eager to save costs simply by using more people. In their eyes, it's killing two canaries with one mine. I suspect if more of the outside mines return to operation, China will still be able to undercut them, even if they have to flood the market in so doing.
The geopolitical reality is that if it becomes necessary all governments of modern industrial nations and those in the process of becoming such will "sponsor" because they will regard it as an unavoidable strategic necessity. Furthermore they will with one voice tell the WTO to vanish making short sharp jerking motions if they consider that to be necessary as well. However big they are the Chinese are still only one nation within that organisation and rule book or no rule book geopolitical self-interest still drives most decisions.
My bollocks - since when has China considered the environment in any of it's industrial and/or idealogical endeavors? If the figure of 97% is accurate, then it's simply about control - in the global market, the tech world and international politicking.
Since 1973, as it turns out:
http://en.wikipedia.org/wiki/Ministry_of_Environmental_Protection_of_the_People%27s_Republic_of_China
I have no reason to believe the Chinese are any less competent at environmental regulation than, for example, the US, and that the MEPPRC are any more incompetent than the EPA. But then, the US are currenlty planning on digging up large parts of Alaska so that they can extract all that lovely environmentally friendly shale oil.
If the PRC suffers from anything that seriously hampers its environment, it is most likely corruption amongst minor officials, who are bribed to turn a blind eye. You'd have to be very hubristic to state categorically that this sort of thing would never happen in whatever country you happen to live in.
...mining the moon! Plenty He3 up there too (apparently) as an additional benefit.
All I need now is a fleet of robotic combine harvester looking thingies, and a cellar full of human clones.
Ironically, 100's of human clones will still need loads of metals (some precious), so we're back to where we started I guess...
Yes, others are opening outside China production.
But the real point is that the quantities used in this gear are tiny. OK, terbium (green phosphor) is expensive, $5,000 a kg last time I saw.
But I would be absolutely astonished if the entire global electronics industry used more than 500 tonnes a year. More likely 50 tonnes. For example, it's also used in CFLs and the company that makes the majority of global CFL charges uses under 1 tonne a year.
Even if it's that higher number, 500 tonnes, we're still talking what, a buck or two per screen?
The "Rare Earths" is the name of the group, we are stuck with it for historical reasons but most of the elements are not particularly rare, they are fairly hard to separate from each other, but much easier than many other common industrial chemical processes. For a long time they were almost unused so no-one much bothered about mining and refining them, then the Chinese saw an opportunity to earn foreign currency as use started to grow and we let them take a near monopoly.
However if they get really short there are millions of tons of spoil heaps in Cornwall just waiting to be mined!
'However if they get really short there are millions of tons of spoil heaps in Cornwall just waiting to be mined!'
Perhaps not too far-fetched - although bloody Prince Charles and the National Trust who own most of Cornwall between them would probably block it.
Quite recently, sizeable amounts of indium* have been identified in ores from South Crofty (the last mine to work in Cornwall), and across the pasty wall the Hemerdon Mine near Plympton is about to start producing large quantities of tungsten. I wouldn't be too surprised if some of the Cornish tips were also valuable sources of wolframite which was mined alongside tin in the 19th Century, but thrown away as being valueless and for making cassiterite hard to smelt.
*okay not a rare earth, but very, very necessary in touch screen displays.
"Quite recently, sizeable amounts of indium* have been identified in ores from South Crofty (the last mine to work in Cornwall),"
They have indeed found reasonable amounts.
"and across the pasty wall the Hemerdon Mine near Plympton is about to start producing large quantities of tungsten."
I've got someone going in to see them tomorrow in fact to ask about the RE contents of their ore.
"be too surprised if some of the Cornish tips were also valuable sources of wolframite which was mined alongside tin in the 19th Century, but thrown away as being valueless and for making cassiterite hard to smelt."
Ah, no, those were all sold off to Germany in 1905-10 or so. Because the Freiberg (amazingly, where I am right now) mines were Sn W and so they had the technology to deal with mixed ores.
There are reasonable amounts of REs in the waste lakes of china clay extraction though. Plus Ta, Sc and Li. No one's quite sure if they're economic but they are there.
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The PRC is a choice source not just for the labor and the culture of bribery but also because of the lax/non-existent environmental laws.
This play well into Rare Earths. They are not so rare and if you process ore for one you can get them all. This processing does however produce a large amount of toxic byproducts which would incur a large expense to clean up if they were processed in a sane country.
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