It can be said that rare earths are the basis and drive of all modern technologies. Rare earths are a collection of 17 elements in the periodic table and it just so has it that China has the world's largest deposits. They are found in the earth’s crust and are not as rare as the name would have one believe. They are usually bound to other elements and thus must be separated after they are mined. Technologies developed in the mid 20th century have made it easier to separate them, paving the way for science to exploit their properties.

Rare earths can now be found in just about all gadgets in every-day life, from flat-screen television sets to iPods. One of them, Neodymium, is the key element used in today’s most powerful magnets. Klaus-Martin Blechert from the magnet company Deutsche Techna explains:

"Large-scale deployment has only been around for about 15 years. And advancements continue because these magnets have much better magnetic properties in smaller quantities. That allows us to make things much smaller. And it also allows the magnets to be used in highly specialised applications, for example in computers, hard discs and mobile phones, to name a few. The automobile industry also uses a lot of magnets.”

Main component in most technologies

All modern technologies – from green to military technology – would be unthinkable without the use of rare earths. Mark Brown, CFO of the company Rare Element Resources in Canada elaborates:

“Some of the elements that are more in demand these days are Lanthanum, Neodymium and Cerium. They are used in windmills – wind turbines inside windmills produce electricity and those are magnetic motors that do that. There’s also many military applications as well: these 'smart bombs' you hear about; some of the stealth fighter and stealth ship technologies. Many of those technologies use these things, so it is something the US government is very concerned about.”

Supply crunch

Knowing all that, it seems understandable that reports in 2009 that China’s government is considering tightening its grip on its precious rare earth resources sparked fear in the West. China has decided to offer only 25% of their production for export and there is talk that by 2012, rare earth production will only be enough to cover the country’s own demand. This is most likely an attempt to motivate foreign companies to move their production to China.

Mark Brown seems confident that China will not completely withhold the elements and explains:

“The Chinese are coming up with their own technologies, for which they will need their REEs, so they are reducing exports. They are trying to accommodate the rest of the world, but their demand is going to be favoured over demands from outside the country, just like any other country would favour themselves first as well."

The exploration and expansion of new production sites is very time consuming and costly. It is forecast that other countries such as South Africa, Australia, the USA and Canada will be able to produce around 50,000 tonnes of rare earths by 2014. But being that world demand is expected to grow to 180,000 tonnes, it looks like China will be calling the shots.

Author: Sarah Berning
Editor: Grahame Lucas