Recently I discussed the global controversy over China’s short-term cornering of the market in strategic, rare-earth minerals. This issue has legs, as they say, and WSJ’s China Real Time Report blog reports on it today:
U.S. Secretary of State Hillary Clinton is raising the issue ahead of this weekend’s Group of 20 nations in South Korea, as are business groups around the world. Some have said China should face international pressure at the G20 to export more rare earths. There are also suggestions the U.S., Germany or Japan should file a complaint over China’s export quotas at the World Trade Organization.
The blog goes on to point out what I did, that this shortage is a short-term one:
Production is already ramping up quickly [from Australia' Lynas Corp. and U.S.-based Molycorp]. As this production comes online outside China, supply will actually outstrip demand by around 20,000 metric tons in 2015, according to according to the copy of a presentation by two of the world’s leading rare earth analysts reviewed by The Wall Street Journal.
Globally activity is already ramping up quickly, as old industries like the oil sector and new ones like battery makers clamor for answers. As rare earth production outside China comes online, supply will actually outstrip demand by around 20,000 metric tons in 2015, according to a presentation by two of the world’s leading rare earth analysts reviewed by The Wall Street Journal.
In their joint presentation for an industry event, the analysts, Judith Chegwidden, managing director of Roskill Information Services and Dudley Kingsnorth, executive director of Industrial Minerals Co. of Australia, put global demand at 185,000 metric tons in 2015 from 125,000 metric tons in 2010.
It appears the hullaballoo is over the current problem of shortages and export delays. And no wonder, since Japan’s consumer-focused export industries (autos, electronics) use considerable amounts of rare-earth minerals and rely on a constant supply at competitive prices.
Over the longer term, however, it appears the U.S.A. will enjoy the position – via Molycorp — of providing a sought-after commodity that, not incidentally, is critical to the production of U.S. military products.