On the wire:
Akihiro Ohata, the Japanese trade minister, said Friday that his ministry was aware that Japanese traders were complaining of a halt from China of a crucial category of minerals and that the government was investigating the matter.
The Chinese Commerce Ministry has denied that it has halted exports of the minerals, known as rare earths and used in products like wind turbines and hybrid cars. And Mr. Ohata said the Chinese Commerce Ministry had also informed Japan that it had not issued a ban on exporting the minerals.
Eight executives, analysts and traders in the Chinese, Japanese and North American rare earths industries said that China had suspended the shipments Tuesday in response to a diplomatic dispute over Japan’s detention of a Chinese fishing trawler captain.
China mines 93 percent of the world’s rare earth minerals and more than 99 percent of the world’s supply of some of the most prized rare earths, which sell for several hundred dollars a pound.
Rare earths are used in a wide variety of industrial applications, including the manufacture of glass, batteries, catalytic converters, compact fluorescent bulbs and computer display screens. Demand has risen in the last decade for their use in clean energy applications, like generators for large wind turbines and lightweight electric motors for cars.Rest of article here: www.nytimes.com/2010/09/25/business/global/25minerals.html
This is nothing more than leverage for the Chinese. We have to realize that "rare earths" are not as rare as the name implies, but it is rare that governments allow for the mining of the minerals as the by-products can be toxic.
All of the world's heavy rare earths (such as dysprosium) are sourced from Chinese rare earth sources such as the polymetallic Bayan Obo deposit. Illegal rare earth mines are common in rural China and are often known to release toxic wastes into the general water supply.
But fear not, my earth loving Prius driver.
The world’s two largest reserves of Rare Earth materials outside of China are in Mountain Pass, California and Mount Weld, Australia. Neither of these deposits are currently in production. Lynas Corporation (the current owners of the Mount Weld deposit), has begun development of a mine and concentration plant in Australia and a processing facility in Malaysia. Lynas has no announced plans to produce NdFeB magnets or intermediate materials. On the other hand, Mountain Pass, California possesses a mine that produced for 50 years prior to the suspension of mining operations in 2002. MM LLC plans to restart mining operations and complete an extensive modernization and expansion of the related processing facility. MM LLC further plans to broaden its operations to encompass the production of metal, alloys and NdFeB magnets. The initial planned production upon full restart in 2012 is 40 million pounds REO per year (almost 7 million pounds of Nd and Pr oxides). This production can be achieved by using less than half the tons of ore that was required in the past to produce 40 millions pounds REO per year.
More information on Molycorp here: Molycorp - I have no economic or financial interest in this company, just an interest in the industry.
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