Rare earth metals: hope or hype?
After a conference earlier this year in Juneau, Alaska, I bought into the belief that rare earth metals were in short supply, that Alaska could provide them, and that failure to mine such metals in the US would negatively affect the US economy. I even blogged to that effect.
Now tonight as the weekend closes and I savor pains of a long bike ride up the valley and the strains of Maria Stuarda, the opera by Donizetti, I read that I was hoodwinked and lied to. Or was I just another victim of hope & hype? Or are the reports I read just bragging by China?
Here are links to the two articles that set me thinking:
- Only a handfull of rare earth mines will emerge outside of China.
- Substitution hurts rare earth demand.
The first report notes:
The main reason cited for so few mines is the relatively small demand for rare earth metals outside of China. Most of the major electronic manufacturing resides within China.
The second notes that folk who need rare earths are finding other metals that appear to work as well. It seems the demand for rare earth metals is down as the economy is down and demand is down. The reports say that only those few non-Chinese miners who have a good project and are well advanced will succeed. The rest will fail.
It sounds almost like the early 1980s when everybody had a new molybdenum mine in the pipeline. Then the economy tanked and most moly mine plans were shelved. None to my knowledge have ever been resuscitated. There is still a vast amount of moly out there; we can get it simply by opening those mines planned & abandoned in the early 1980s.
Is this now the story to be of rare earths?
Are the facts these:
- China makes things and will mine the materials it needs to make them
- The USA consumes things and will import the mined products along with the goods.
- Maybe one or two rare earth mines are all that is needed to supply the paltry US demand for the few things it actually makes.
- US ingenuity and inventiveness renders the need for rare earths a non-demand thing.
I do not know whether to be cheered or distressed. Clearly I was a victim of hype & hope. National pride in mining made me believe that Alaska could do what the rest of the US seems unable to do. I obviously forgot the basics of supply and demand and the ability of folk to find other ways when things get too costly. Then a glimmer of optimism shines: maybe the Chinese and Australians are just making this up in order to scare investors aways from supporting new rare earth mines in the US.
So on a quiet Sunday night, having just watched Elizabeth I condemn Mary Stuart to beheading, I conclude that politics is never-ending and the quest for the crown goes on. I must advise: keep looking for rare earths in Alaska and the lower 48; keep investing in new mines; keep looking for new ways to do things better. And make up your own mind in this knotty situation.