Daily Parse | Donald Trump is looking for ways to get his hands on more rare earths
While their names – gadolinium, ytterbium, scandium, to name three – may be unfamiliar to most ears, rare earths, are, in fact, quite common.
In this case, “rare” refers to the fact that they are seldom found in deposits that are large enough to make mining them a profitable venture. That means that as demand for them increases – they are used to make many of the vital components in today’s electronics, including batteries for electric cars, which require about 10kg of a rare earth known as lanthanum – whoever controls the supply of them has considerable influence over world trade.
For now, that is China. America’s economic rival is reckoned to hold the largest reserves of rare earths, an estimated 35%. Crucially, it also said to have 85% of the world’s processing capacity, a status Washington accuses it of obtaining unfairly, to the detriment of the US economy and to the peril of its military.
America has a reserve of its own, but its sole rare-earths mine, once the most productive of its kind, had to be saved from bankruptcy in 2017 and, even at full capacity, cannot meet the country’s needs.
With the two countries increasingly locking horns, this is a situation that the White House, in an executive order issued by Donald Trump last week, described as a threat to national security, blaming China for “aggressive economic practices” that allowed it to achieve its dominant position.
While Mr Trump’s order directs his Interior Department, the executive office responsible for mining, to break the country’s reliance on imports of rare earths and other critical metals by ramping up domestic production (the two leading sites are, coincidentally, in Texas and Minnesota, both key election states) this will not be a job America can accomplish alone. Making the country’s supply chain robust again, it admits, will require “co-operation and co-ordination with partners and allies”.
Initially, the biggest beneficiary of Mr Trump’s hunt for rare earths will be Australia, the world’s number-two producer, and a country with which the president signed a deal last year regarding critical minerals.
Further down the line, other allies could help sate America’s need for rare earths. One is Canada, another big producer and the recipient, in 2020, of $40 million in funding to expand its rare-earths production capacity.
Another is Greenland. To get a sense of the country’s potential as a rare-earths exporter, consider Greenland Energy. The Australia-listed mining firm has spent more than a decade seeking to develop and now seek licensing for a rare-earths mine at Kvanefjeld, near the town of Narsaq (pictured above), in extreme southern Greenland. The deposit is purported to be the second-largest of such minerals in the world.
This fact may have been what motivated Mr Trump when he suggested doing a “real-estate deal” with Denmark to acquire the island. Most people there were insulted by the offer, but the administration’s announcement, a year later, of a $12 million aid package for economic development there was warmly welcomed; Greenland views mining as a key element of an independent economy and the money from can help it on its way
That may be too little, too late for Washington to get its hands on Kvanfjeld’s rare earths: in 2016, Greenland Minerals’ received a $3 million investment from Shenghe Resources, one of China’s largest producers of rare earths, in exchange for an option to purchase all of the minerals it produces.
One way or another, Greenland’s rare earths will be a matter of America’s security.
- Trump Moves to Expand Rare Earths Mining, Cites China Threat
- Greenland Is Not For Sale. But It Has Rare Earth Minerals America Wants
- Greenland shines brightly in the rare earth spotlight
- Here’s why China’s trade war threat to restrict rare earth minerals is so serious
- Canadian rare earths metals look for shot in the arm from U.S. government funds
- Greenland gov’t allowed to review uranium project agreement; confirms Shenghe “intent” to buy controlling stake
- Executive Order on Addressing the Threat to the Domestic Supply Chain from Reliance on Critical Minerals from Foreign Adversaries
The White House
- Outcomes from White House meetings
Office of the Prime Minister of Australia
- The United States and Australia Formalize Partnership on Critical Minerals
US Department of the Interior
- Greenland Minerals (website)
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