Yves here. I must confess to being ignorant of the fact that there was protectable technology involved in the processing of rare earths. My understanding had been that despite the name, rare earths are not all that rare, and that the US had been willing to cede mining to other countries, particularly China due to the high environmental cost, particularly water use/contamination.
In a new round of tit for tat, China has added to its restrictions on exports of key materials, including rare earths, by also halting exports of processing technology. And as the article below makes clear, China’s real choke point is not in mining but in processing.
By Tsvetana Paraskova, a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. Originally published at OilPrice
China is prohibiting the export of some technologies to process rare earth elements to protect its national security as the race for critical minerals supply intensifies.
China’s Commerce Ministry banned on Thursday the export of technology to extract and separate rare earth elements (REEs), a group of 17 critical metals used in the manufacturing of permanent magnets that are used in electronics, EV technologies, and wind turbines.
The move follows last month’s directive from the Chinese authorities to exporters of rare earth minerals to report transactions and is the latest escalation of the trade spat between China and the West.
Earlier this year, China, the world’s largest producer and supplier of graphite, said it would require export permits for some graphite products as of December 1 as it seeks to protect its national security. Graphite and graphite products are critical for the manufacturing of any electric vehicle battery, and China is the dominant player in the market.
The restriction on exports of graphite products was the latest Chinese attempt to exert its market influence to control the supply of critical minerals.
Now China bans the export of production technology for rare earth metals and alloy materials, and technology to produce some rare earth magnets.
In rare earths, China controls 60% of global supply and a massive 90% of the global refining of rare earth elements, the International Energy Agency (IEA) said in a report on the vulnerabilities of the clean energy supply chains earlier this year. China is also the only large-scale producer of heavy rare earth ores.
Limited diversification of supply could present a challenge to the global critical minerals industry, the IEA warned in a report earlier this year. China, the Democratic Republic of Congo, and Indonesia continue to dominate a large part of the critical raw material supply, while China is a dominant player in refining operations, the IEA noted.
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Entrepreneurs are mining platinum and palladium in catalytic convertors with Sawzalls underneath cars in Chicago.
Yes, I heard that they have already gone public.
EVs hit another pothole: inability to repair batteries – even after light damage – leads to low-mileage EVs being written off by insurer, in this case, the BC provincial insurance corp: ICBC scraps 2022 electric car after owners faced with $60,000 bill to replace damaged battery.
How long does one of those batteries last? What’s the perspective for used electric vehicles if you have to replace them?
My impression is that the costs involved in either repairing damaged batteries, or replacing used up batteries will lead to a complete atrophy of the market for second-hand BEV.
In a sense, this is what the manufacturers want: people buying new cars, not extending the life of their existing cars. And those manufacturers are probably not really interested anyway in having to produce the specific kind of batteries for a model that they launched 20 years ago and is no longer in their offering.
I would like to be able to repurpose used Iron Phosphate EV batteries into residential electric storage of solar panel output.
I think Iron Phosphate batteries will outlast the ev vehicle in most cases and does not pose the same Lithium Ion battery danger of combustion – repair and recycling along with long term durability should be targets of the auto industry instead of the need to keep sales of replacements high for maximal profits sake.
Sort of like when the advertising for lifetime antifreeze was pulled because they couldn’t get the repeat sales high enough.
Or the new method of competition which appears to be outright cheating – like tripping the leader in a track race in order to claim winner of race. Or claim some harm and future profit loss because of some restriction on your sales due to some issue like killing your environment or poisoning land and people.
I wonder how much pollution and environmental degradation could be avoided by figuring ways to throttle this jet fueled overconsumption and status attainment economy. Maybe if crashing of this economy will be put a dent in it…. just got to figure a way to shake of the creditor overhead at the same time
There seems to be a reusable limit of 1,000 charges/discharges before significant drop in capacity in almost all types of recchargable batteries.
This guy in Finland decided to blow up his Tesla after being told he needed a new $22,000 battery – (he put a dummy of Elon Musk in the drivers’ seat).
https://youtu.be/DG9Izqp6WWU?si=q83d8KU7r6hRimdh&t=421
If you can avoid an accident most EVs currently in production are serviceable for 500,000 miles
Fine quality electric vehicle batteries are easily replaceable in China, at times replaceable at charging stations, are almost entirely recyclable and are cost effective overall. Chinese EV batteries to my knowledge however cannot be sold in America and may not be available in Canada:
https://news.cgtn.com/news/2023-07-25/China-boosts-recycling-tech-to-meet-power-battery-challenge-1lIEUVwHxcc/index.html
July 25, 2023
China boosts recycling tech to meet power battery challenge
China, one of the world’s major producers and users of power batteries, has been faced with a huge rise in the decommissioning of batteries in recent years, responding to the challenge with large-scale recycling efforts.
China’s Ministry of Industry and Information Technology (MIIT) said last week that the country has built more than 10,000 power battery recycling service outlets. In the first five months of this year, some 115,000 tonnes of batteries were recycled, exceeding the total amount for last year….
Should have seen that one coming after a few announcements of batteries being an integral part of the chassis design.
Meaning that in order to replace the batteries the vehicle basically has to be completely disassembled.
The batteries are heavy, and they have heavy containers. The attempt is to make the battery “containers” part of the structure of the car, instead of just making a free-standing “box of batteries”.
China’s restrictions on the export of rare earth technology is not likely to have the same impact that the West’s restrictions on the export to China of semiconductor technology as there are more options for those seeking rare earths than there are options (at least over the next decade or so) for China in the semiconductor technology space.
Interesting point. The Dutch company ASML has a monopoly on the most sophisticated chip-manufacturing technology, is now prohibited from selling to China, one of the biggest markets worldwide. The imperial overlord forbids vassals to do business with certain countries.
https://www.firstpost.com/world/asml-holdings-dutch-company-that-has-monopoly-over-global-semiconductor-industry-12030422.html
https://www.reuters.com/technology/dutch-lawmakers-question-new-us-export-restrictions-asml-chip-machine-2023-10-24/
On the other hand, as we have seen with “sanctions” on Russia that backfired, China will likely develop it’s own EUV (and beyond?) chip manufacturing tech and cut out ASML and other western countries altogether. It may take some time, but the US (and vassals) has sanctioned itself into a corner.
“China’s restrictions on the export of rare earth technology is not likely to have the same impact…”
https://twitter.com/RnaudBertrand/status/1737635601015619799
Arnaud Bertrand @RnaudBertrand
This is a good read on “why the American technological war against China could backfire” and “supercharge China’s creation of an independent computer chip industry”.
https://theconversation.com/why-the-american-technological-war-against-china-could-backfire-219158…
It’s exactly what is happening and at the end of the day, as the article makes clear, it’s all about hubris. It was always beyond delusional for the US to believe that it could stop the technological progress of a country that IS AHEAD OF THEM on all metrics that matter for it, as detailed in the article…
I couldn’t link to your article. If any else is having a problem, this one works for me:
https://theconversation.com/why-the-american-technological-war-against-china-could-backfire-219158
Great article!
https://twitter.com/RnaudBertrand/status/1737635601015619799
Please just click on the link; I think it will work.
This is a perfect picture of the divide taking place between the West vs the East: China, Russia, and some of the BRICs nations.
Michael Hudson has been pointing this out for than a year and a half.
It’s a fight primarily waged by the US Financial System vs non-western nations.
A long, arduous task that will take many years to see who wins, who loses.
That is quite a remarkable tweet that. I am going to guess that as China develops all their own native technology which counts out the Dutch for example, that the US will come out with a law forbidding all countries to import that Chinese tech in the same way that they have a law forbidding countries buying Russian weaponry. if you buy that Chinese tech, then you will be punished for it.
Investing big time into higher education, research and development actually pays off in the long term? Who knew?
I am going to guess that as China develops all their own native technology which counts out the Dutch for example, that the US will come out with a law forbidding all countries to import that Chinese tech…
[ This is precisely what the US is now attempting with technology advances from Huawei; prevent the application of the advances abroad… Also, the US is trying to limit Chinese export of advanced technology alternative energy resources:
https://www.globaltimes.cn/page/202311/1302422.shtml
November 23, 2023
Bigger global production role to help Xinjiang defy US ban
It seems that US scrutiny of imports from Northwest China’s Xinjiang Uygur Autonomous Region is still haunting global industry chains. The development adds to the urgency for China to consolidate and expand Xinjiang’s manufacturing presence in global production chains.
Electronic products from Malaysia and Vietnam are facing closer US scrutiny over their components derived from so-called forced labor in China’s Xinjiang region, Reuters reported on Wednesday….
America has spent forty years turning it’s own great public universities into crap. Instead of higher institutes of research and learning, the goal is to load students up with debt. The adjuncts instructors are paid a pittance. And who cares if all of this results in an education which can contribute to society? Or advance science? That’s no longer the goal, it’s all about to money.
I would disagree. It will take years to set up new mines.
Not to mention, any new mines and processing plants are less likely to be cost competitive.
One “cost” is of course the socialized cost of a dead or dying political economy, wounded more or les fatally by growth, greed and compound interest. That “cost” somehow never makes it into GAAP and corporate reports and spreadsheets.
Maybe AI will develop a conscience and fix all this, to the benefit of the species and especially workers…
BWAHAAHAAAHHAAHAAA!!
“I would disagree. It will take years to set up new mines.
Not to mention, any new mines and processing plants are less likely to be cost competitive.”
This strikes me as correct, especially so since American manufacturing productivity has failed to increase at all since the beginning of 2011:
https://fred.stlouisfed.org/graph/?g=Of7F
January 30, 2018
Manufacturing Productivity, * 2000-2023
* Output per hour of all persons
(Indexed to 2000)
It does take time and money to open new mines, but the largest rare earth element mine in the world up until the 80’s is in California:
Mountain Pass mine https://en.wikipedia.org/wiki/Mountain_Pass_mine
This is yet another example of where America was the leader in the technology, and in actual production. If the Buy American Act (passed in 1933) has been strongly enforced, the mine would not have closed (or alternative US sources would have been developed), but waivers and exemptions to the act sky rocketed under Reagan, and became routine after that.
It is likely that China has developed new and improved processes for the processing of the ore. This is why the whole concept of “we will off shore the manufacturing, but retain the technology” has been a flawed approach for the last forty years. It allowed American CEOs to take advantage of cheaper labor, but losing the technological edge is almost inevitable, and losing your factories, and labor force is a given. This is not a “whocuddaknowed” outcome, it was predicted in classified studies done for the DOD.
I work in mining right now.
It takes years to open up old mines and that’s assuming the ore is still economical to extract remaining in the mine.
Not only has China developed better processes. The other problem is that the US is starting from ground up. People who worked their decades ago are either retired or have gone to another industry. There isn’t the technology know how anymore.
Sure, some of the professionals have transferable skills in existing fields like mining and oil extraction, but it’s also a new type of ore.
Those processes are going to have to be invented from ground up, because the Chinese are not going to share their technical knowledge.
It’s going to take a lot of time to get everything set up and it probably won’t be cost effective. More inflation for sure at home.
Didn’t Huawei this year release a 7nm chip? As in, all of a sudden Chinese foundries are right behind the Taiwanese. It does cost a lot to catch up the Dutch and Taiwanese in this technology, which is the main prohibitive factor. But with sanctions, it is the only option.
Russia aims to be able to produce domestically everything needed in the semiconductor business by 2025. Their biggest problem is that all their physicists with the required knowledge are 80 or older. Although the Institute of Applied Physics of the Russian Academy of Sciences is reported to have demonstrated a new type of X-ray lithography machine that can already do 7nm, but with twice the efficiency (whatever that means). Commercial production set for 2026-7, only for the domestic markets.
I’m not saying either China or Russia can catch and maybe even take over the current manufacturers, but it sure looks like they’re going to try.
https://twitter.com/RnaudBertrand/status/1733313869551222863
Arnaud Bertrand @RnaudBertrand
Incredible: a mere 3 months after the groundbreaking release of the Huawei Mate P60 that revealed China could manufacture 7nm processors, Huawei seems to have made another leap by releasing a laptop with a 5nm processor.
If confirmed, it means the pace at which China is progressing is just insane.
https://www.tomshardware.com/tech-industry/semiconductors/china-poised-to-break-5nm-barrier-huawei-lists-5nm-processor-presumably-built-with-smic-tech-defying-us-sanctions…
9:33 PM · Dec 8, 2023
https://www.yahoo.com/lifestyle/huawei-matepad-pro-game-changer-112715546.html
December 19, 2023
Huawei’s new MatePad Pro is a game-changer for content creators
Tablets have come on leaps and bounds in the last decade, with new technologies making these compact devices more powerful than many ever thought possible. And advancements show no signs of slowing down at Huawei’s ‘Creation of Beauty’ innovative product launch event, where the tech giant has revealed its all-new 13.2-inch MatePad Pro tablet.
There are multiple ways to get to that feature size, but i think the industry has embraced the ASML machines because their approach has so far produced the highest yield (working chips pr wafer) at the least effort.
The basics of rare earth separation technology haven’t changed since the 1950’s. The trick is being able to adapt to variations in the input feed, which only comes with experience. Separation plants in France, Estonia and Malaysia have all learned this.
The new Chinese policy isn’t really different than past practice. China in fact prohibited import of rare earth separation technology so that their industry would learn on their own and develop the necessary skills. Where there is a will, there is a way.
well, they are apparently rare after all.
Seems always be the same responses. The US dollar can’t be replaced. Whatever technology we have cannot be replaced. Anything anyone else in the world produces, especially China and Russia, is easily replaceable. I sure hope we are right about this because if not we are headed for a big ugly crash. I am not a technology expert so just my uneducated opinion :)
Yes, there’s plenty of rare earths and its relatively easy to separate out the rare earths ore. Problem is separating the rare earths from themselves into pure metals/powder which is a very intensive chemical process with a lot of nasties. Which is why China has been able to dominate processing through environmental arbitrage. Australia has for sometime tried to start an onshore refining industry but environmental barriers remain a big hurdle even though these are lower than US. Chinese refineries usually sell their excess capacity for ‘toll’ processing of the non-China sourced high purity ore concentrates and return as pure metals/powder. This is the fudge that a lot of non-Chinese rare earths still rely on a China supply chain (processing) bottleneck. If this ‘toll’ processing gets turned off (which maybe what this policy change is threatening between the lines?) the West would be in a real pickle.
I have direct experience prospective and trying to set up a Rare Earth Element (REE) mine.
REE are common, but are distributed in tiny (parts per billion) amounts across the globe. All rocks have some amounts of these elements. This is the source of the “not so rare” quip.
Finding concentrations of REE minerals that can mined is not common. It’s a similar situation as iron, which is found in nearly every rock but only minable in specific locations where iron is concentrated. Bastnatite (REE carbonate) and monazite (REE phosphate) are the targets for mining, as they are easiest to crack. Most common is REE silicate (IIRC allenite), but cracking the Si-O2 bond is not happening. Complicating matters is that the REE, uranium and thorium form minerals together. Refining REE ores also concentrates uranium and thorium, which creates a significant radiological problem. Finding REE ores that are low-to-no in U and Th are key (unless you want the U and Th).
Back in the day I had a no-U no-Th monazite deposit in AZ and convinced Molycorp (who was running the Mountain Pass CA mine and plant at the time) to take my ore even though Mountain Pass is a bastnatite mine. Cracking my phosphate at their carbonate process plant was their problem. My problem was that monazite is hard to separate from the rest of the material on my site, as in terms of density and electrical properties, which is how minerals are most easily separated, it sits nearly in the middle with many common minerals (olivine, garnet, etc.). Molycorp wanted concentrated ore. The project went belly up before we figured out the process, as did Molycorp shortly thereafter.
Anyway, i hope this clarifies the status of REE as “rare” and difficulties in processing the ores.
I would disagree. It will take years to set up new mines.
Not to mention, any new mines and processing plants are less likely to be cost competitive.