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U.S. House Addresses China's Rare Earth Monopoly

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After letting the horse out of the barn years ago by allowing the ONLY U.S. rare earth element (REE) production facility to close (Molycorp's Mountain Pass mine.) and thereby leaving the Pentagon dependent on China for critical weapons components, the House of Representatives has begun addressing the problem with the introduction of H.R.4866 - The RESTART Act.

http://www.govtrack.us/congress/billtext.xpd?bill=h111-4866.

Introduced by Representative Coffman (CO)on March 17, H.R. 4866: Rare Earths Supply-Chain Technology and Resources Transformation Act of 2010, "The RESTART Act," recognizes that although the U.S. has about "15 percent of the world's REE's in the ground, it now depends nearly 100 percent upon imports for rare earth elements, oxides, and alloys."

With the closing of the mine the U.S. lost not only the actual production but also the expertise of those specialists who worked in the mine and those who refined the metals but who have had to move elsewhere for work.

Rare earth elements or REE's, are some metallic elements which are mostly rare in nature and can be difficult to process. They are also critical for such things as large scale wind turbines, electric cars, and many military applications as well as simple domestic lights and even computers.

As Section 2 (Findings) of H.R. 4866 states:

"(1)Many modern defense technologies such as radar and sonar systems, precision-guided weapons, cruise missiles, and lasers cannot be built, as designed and specified, without the use of rare earth elements ('REEs') and materials produced from them.

(2) Significant quantities of REE are used in the production of renewable energy technologies, including advanced automotive propulsion batteries, electric motors, high-efficiency light bulbs, solar panels, and wind turbines. These technologies are used to advance the United States energy policy of reducing dependence on foreign oil and decreasing greenhouse gas emissions through expansion of renewable sources of energy."

As I have reported previously, China now produces or owns the foreign production capacity for more than 95 percent of the world's supply of rare earth elements which is why most of the high-tech jobs associated with today's major wind turbine projects are actually located in China with the U.S. jobs mostly involving basic construction and manufacturing of structures.

http://newsblaze.com/story/20100216091952mcco.nb/topstory.html

In addition to military and other big-ticket items such as electric cars, rare earth elements are required for the magnets used in computer hard drives, even LED lights and the curly energy-saving CFL's many of us already use and are even mandated to replace old fashioned filaments light bulbs in many countries.

http://www.raremetalblog.com/

Just why we should be so concerned about China's near complete monopoly on rare earth elements is simple - although they currently supply the world, China's domestic production of magnets and electronic components is now increasing so rapidly that the country's increased use of REE's is outpacing increasing production - in other words, China is not only likely to but is actually planning to use all its production (95%+ of the world's supply) for its own manufacturing.

H.R. 4866 states:
"China's ability-and willingness-to export REEs is eroding due to its growing domestic demand, its enforcement of environmental law on current producers, and its mandate to consolidate the industry by decreasing its number of mining permits. The Chinese Ministry of Industry and Information Technology draft rare earths plan for 2009 to 2015 proposes an immediate ban on the export of dysprosium, terbium, thulium, lutetium and yttrium, the 'heavy' REE and a restriction on the exports of all the other, light, rare earth metals to a level well below that of Japan's 2008 demand alone."

The House Bill calls for the creation of a new strategic REE stockpile and an effort to establish production and processing facilities in the U.S.

John McCormick is a reporter, /science/medical columnist and finance and social commentator, with 17,000+ bylined stories. Contact John through NewsBlaze.

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