U.S. Called Vulnerable to Rare Earth Shortages

A detailed report released this week by the United States Energy Department warns that the U.S. is too reliant on China for minerals crucial to new clean energy technologies. The report predicts it could take 15 years for America to break its dependence on Chinese supplies, and urges the nation to increase research and expand diplomatic contacts to find alternative sources, while also developing ways to recycle the minerals or replace them with other materials. Ninety-six percent of these rare earth minerals are produced in China, and that country has begun wielding various export controls to limit the minerals’ supply to other countries, while favoring its own manufacturers to use them. The report presented a fairly gloomy assessment of the United States’ ability to wean itself from Chinese imports, but reflected an emerging view within the government that domestic sources of the minerals are needed. China is increasingly dominating the manufacture of clean energy technologies that require such minerals, in large part because export restrictions on rare earths, along with cheap labor and extensive Chinese government subsidies, make it more cost effective for clean energy manufacturers to shift production to China. China is also extensively researching ways to use the powerful magnetic and other properties of rare earths. According to David Sandalow, the assistant secretary of energy for policy and international affairs, “[T]here are thousands of rare earth researchers in China and dozens in the United States, and that underscores both the challenge and the opportunity. Their expertise in this area is significant.” Dozens of small mining companies hope to open new mines in the U.S. and elsewhere to tap reserves of rare earths, but, the report said, these companies face formidable legal, financial, marketing and management obstacles.