China Cuts Rare Earth Minerals Exports; Mine in California Reopens after 8 Years

Thursday, December 30, 2010
The United States can’t reopen its last operating rare-earth-minerals mine fast enough, now that China has again cut its exports of the highly valuable minerals. After slashing exports in October by 70% over the previous year, the Asian giant decided to trim quotas by 35% for exports in 2011.
 
The moves have left companies in Japan, the U.S. and in other countries reeling, because China controls 97% of the rare earth minerals market. The minerals are a necessary part of such things as smart-phones, hybrid cars, hard drives, air bags, anti-lock brakes and guided missiles.
 
Some relief may be on the horizon if Molycorp Minerals is able to reopen its mine in California’s Mojave Desert. The Mountain Pass mine shut down eight years ago, leaving the U.S. without any domestic source for rare earth minerals. The Chinese government tried to buy the mine in 2005, but was blocked by Congress.
 
Molycorp has raised $500 million since last July to upgrade its 1950s-era facilities at Mountain Pass. It continues to seek more financing.
 
The company hopes to produce 20,000 tons a year of nine of the 17 rare earths by mid-2012.
 
The Congressional Research Service estimates that the United States holds 13% of the world’s reserves of rare earth elements, but mines nothing. China has 36% of reserves, but is responsible for 97% of the world’s production. Another 19% of reserves are located in Russia.
-Noel Brinkerhoff
 
U.S. Mining Company Hopes to Break Chinese Monopoly of Rare Minerals (by David Wallechinsky and Noel Brinkerhoff, AllGov)

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