Given President Trump’s ill advised tariffs on Chinese
exports now sends the world’s economy on the precipice of recession, will China
be using its rare earth metals industry as a pawn in the ongoing US-China trade
war?
By: Ringo Bones
The ongoing US-China trade war – what is it really good for?
Absolutely nothing says most economists, but as it rages on, will rare earth
elements be drafted as reliable pawns in this ongoing trade war?
Believe it or not, there was a time where the United States
and the Soviet Union were the leading producers and users of rare earth
elements at the height of the Cold War. Given that rare earth elements are
close homologues of elements used in the manufacture of atomic weapons, the
Cold War era stockpiling of nuclear weapons means that the mining and
production of weapons grade uranium has produce a quite useful byproduct – i.e.
rare earth elements. Since the end of the Cold War, Beijing has been busy
making atomic reactors for the much needed energy demands in modernizing its
industry and over the years, Mainland China now produces 37-percent of the
global supply of rare earth elements.
Rare earth elements are currently being used in the
manufacture of a wide range of devices that includes smartphones, unmanned
military drones. Neodymium, for example, is used to make those compact and
powerful magnets found in smartphone speakers and haptic feedback devices,
while terbium is used to make solid-state hard drives. It seems that modern
life is very dependent on the low cost availability of rare earth elements.
Mainland China gained a monopoly on the production of rare
earth elements because extracting them from the ground entails a lot of
radioactive byproducts that were previously relegated to atomic weapons
production at the height of the Cold War - which means that rare earth element
mining is not so environmentally friendly. And given Beijing’s rather lax
environmental laws, Mainland China is now second to none when it comes to the
global rare earth metal industry.
