U.S. plans autonomy in rare earth supplies

Contact Counsellor

Last Updated18/01/2022

US senators have proposed a law aiming to end China’s alleged “chokehold” on rare-earth metal supplies.
The law would aim to ensure the United States can guarantee its supplies of rare-earth minerals.
Global rare-earth element supplies are used in everything from batteries to fighter jets.

It aims to “protect America from the threat of rare-earth element supply disruptions, encourage domestic production of those elements, and reduce our reliance on China”.
If it becomes a law, it would require the departments of the Interior and Defense to create a “strategic reserve” of rare earth minerals by 2025.
That reserve would be tasked with responding to the needs of the army, the tech sector and other essential infrastructure “for one year in the event of a supply disruption”.
It also aims to ensure greater transparency on the origins of the components, restricts the use of rare-earth minerals from China in “sophisticated” defense equipment, and urges the Commerce Department to investigate Beijing’s “unfair trade practices”.

China has over time acquired global domination of rare earth metals and it accounts for 60% of the global production.
The remaining is produced by other countries, including Australia, India, Japan and United States.
Production units have boomed in Australia, and the US along with smaller units in Asia, Africa, and Latin America since 2010.
Still, the dominant share of processed Rare Earths lies with China.
India has the world’s fifth-largest reserves of rare earth elements, nearly twice as much as Australia, but it imports most of its rare earth needs in finished form from China.
80% of the United States’ rare-earth imports in 2019 were from China, according to the United States Geological Survey (USGS).

They are a set of seventeen metallic elements which include 15 lanthanides on the periodic table + scandium and yttrium that show similar physical and chemical properties to the lanthanides.
These minerals have unique magnetic, luminescent, and electrochemical properties.
They are used in many modern technologies, including consumer electronics, computers and networks, communications, health care, national defense, etc.
Important even for futuristic technologies like high-temperature superconductivity, safe storage and transport of hydrogen for a post-hydrocarbon economy, environmental global warming and energy efficiency issues.
They are called 'rare earth' because earlier it was difficult to extract them from their oxides forms technologically.
They occur in many minerals but typically in low concentrations to be refined in an economical manner.

Presently, the exploration in India has been conducted by Bureau of Mines and the Department of Atomic Energy.
India has granted government corporations such as IREL a monopoly over the primary mineral that contains Rare earths: monazite beach sand, found in many coastal states.
IREL produces rare earth oxides, selling these to foreign firms that extract the metals and manufacture end products elsewhere.
IREL’s focus is to provide thorium that is extracted from monazite to the Department of Atomic Energy.

India needs to create a new Department for Rare Earths (DRE), which would play the role of a regulator.
Currently, mining and processing has been largely concentrated in the hands of IREL (India) Limited.
But its production capacity lags behind international REE conglomerates.
Indian companies through PPP can be encouraged to do exploration in the Indian Ocean Region for REEs and feed value added products into the Indian market.
India has strong historical, cultural, business and Diaspora links in Indian Ocean region that can be leveraged to produce desired results.
India can also emerge as a global partner for USA in terms of REEs.