The Next EPA Target?
China now controls 95 percent of total rare-earth supply. A figurative sneeze on its export policy is all that’s needed to shake global markets, and in 2010 China began restricting rare-earth exports. International prices spiked, reaching near-dizzying levels last summer before crashing in the fall. In the wake of the World Trade Organization case, they’ve perked up again.
Foreign companies buying rare earths from China must now pay more than twice the rate paid by companies inside China. The tiered pricing encourages companies to move factories and jobs to China, where they can be sure of supply and lower prices. Beyond the extra economic boost for China, this has made it easier for Chinese companies to steal foreign intellectual property. Businessmen and politicians worry that China’s dominance over these 17 elements is a strategic vulnerability, discouraging innovation and threatening national defense.
That may soon change. Encouraged by rising prices and political support, new mines are starting up around the world, most notably in Malaysia and in California, where a company called Molycorp has reopened what until the 1980s was the world’s flagship rare-earth mine.