On July 14, the Ministry of Commerce of the People’s Republic of China announced that, due to environmental damage from rare earth mining, it would impose production caps and export quotas along with tougher environmental standards.
According to the Ministry of Commerce website, rare earth export quotas for 2011 will be 30,184 tons, slightly less than the 30,285 tons of rare earths China exported in 2010. China currently supplies 97 percent of the world’s rare earth elements and has about 30 percent of the world’s proven reserves.
The announcement follows a World Trade Organization (WTO) ruling against China for cutting exports of eight raw materials (not rare earths). Industry in the United States and Europe had expected the WTO’s ruling to spur China to increase export of rare earths, as the 2010 export was insufficient to meet world demand.
As reported in the Wyoming Business Report’s eDaily last February, the American Security Project cited U.S. dependency on China as the sole supplier of rare earths as “a weak link in our defense supply chain.”
Rare earths are a set of 17 chemical elements that are scarce but necessary for a number of technologies, including batteries for electric cars, high-strength alloys for aerospace applications, cracking catalysts for oil refineries, a variety of lasers, portable X-ray machines and PET scans.
According to the U.S. Geological Survey (2010), the United States has approximately 13 million tons of rare earths located in the Western states of California, Alaska and Wyoming.
However, none of the U.S. sources are currently in production. In Wyoming, the Bear Lodge property (which Rare Element Resources has 100 percent interest in) was estimated to have a resource of 4.9 million tons of rare earths.
The latest news in rare earths was reported in Nature Geoscience on July 3, where a study of mud on the floor of the Pacific Ocean indicated that rare earth metal concentrations in the mud were comparable or greater than the concentrations at some of China’s rare earth mines.
According to scientist Yasuhiro Kato, at one sample site in the central North Pacific, an area of one square kilometer (0.4 square miles) could meet 20 percent of the world’s annual demand.
This was welcome news, especially to Japan, which had its rare earth imports from China unofficially blocked late last year due to a territorial dispute, according to a report in the Wall Street Journal.
Wyoming Business Report