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Message: U.S. Scrambles To Find Alternative Rare-Earth Suppliers

US Braces For Chinese Retaliation...

With Beijing making louder noise by the day about using rare earth metals as a "nuclear" retaliation option in trade war with the US, Washington is not sitting on its thumbs waiting for the day China pulls the plug, and as Commerce Secretary Wilbur Ross said today, the U.S. will take steps to ensure it doesn’t get cut off from the supply of rare earths.

“These critical minerals are often overlooked but modern life without them would be impossible,” Ross said in a statement. “Through the recommendations detailed in this report, the federal government will take unprecedented action to ensure that the United States will not be cut off from these vital materials.”

“The United States is heavily dependent on critical mineral imports,” according to the report. “If China or Russia were to stop exports to the United States and its allies for a prolonged period -- similar to China’s rare earths embargo in 2010 -- an extended supply disruption could cause significant shocks throughout U.S. and foreign critical mineral supply chains.”

China accounts for more than 70% of global output of rare earths. Ironically, the U.S. was the leading global producer of rare earths from the 1960s to the 80s, when production began shifting off shore.

And here another irony emerges: the U.S. has 1.4 million metric tons in rare earth mine reserves, 93 times the nation’s output last year, according to data from the U.S. Geological Service website; it should be relatively simple to restart mothballed facilities. And yet, it isn't: the only US producer, MP Materials, has been shipping all its output from the Mountain Pass mine in California to China because there is currently no refining capacity available to handle its output anywhere else in the world, its biggest shareholder said.

“As with our energy security, the Trump administration is dedicated to ensuring that we are never held hostage to foreign powers for the natural resources critical to our national security and economic growth,” Interior Secretary David Bernhardt said in a separate statement. “The department will work expeditiously to implement the president’s strategy from streamlining the permitting process to locating domestic supplies of minerals.”

 

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