Rare earths: this is how we've done it
Saturday, February 26, 2011 at 11:36AM
Thomas P.M. Barnett in Citation Post, extractive industries

The growing brouhaha on China's "monopoly" of rare earth production!

But you have to ask yourself, Why did the US and others abandon production, because they didn't run out. 

Nasty business, rare earth mining, so best to go with a place not too fussy on environmental stuff.  China filled that void nicely, making production too cheap for the rest to keep up, hence the current "advantage."

Now, as China, with its minerals-in-the-ground mentality, considers future access, it starts exporting less and hoarding more.

Hence, the frightening future for the West:  we are denied!  China is ahead!  What are we to do?

Simplest thing, of course, is just to pony up the money for the US mine sitting dormant.  Last I heard it was half-a-billion.

Other route already covered in a WS CoreGap report:  Japan already working on electric motor that uses no rare earths.

But this FT piece points out the easiest route:  just use what you have that much more carefully.  How Amory Lovins.

So GE says they've been anticipating this moment for about a decade (What!  Our intell freaks out our defense specialists just this year and GE has been thinking this through for a decade!  Whew!), which, by my experience, is the norm.  About the time DC starts freaking, you can find industry already 7-10 years working the issue.  

This is really common right now in the US national security establishment: constantly finding new evidence of globally integrated production chains that link us to damn near anybody and then freaking out about the possibility of cut-off.  I remember this one scientist-cum-security expert at Oak Ridge going on about how we import so much of what goes into fertilizer, that it would be so easy for our enemies just to cut it off and then we'd be out of food!  Just like that!  Unfortunately (in this fantastic scenario where our entire crops fail), so would the entire cast of most likely enemies, but that was a detail he hadn't thought through.  Almost all of these scenarios read like Cleavon Little's sheriff character in "Blazing Saddles" when he's confronted by the angry mob and he pulls out he gun, puts it to his own head, and yells, "Nobody moves or the nigger gets it!" Naturally, everybody backs off, thinking the sheriff would do it--hard ass that he was!

But again, these are details only the naive types like myself bring up.

So the story on GE here is that they've been through this deal many times in the past with this or that element, and they have a protocol for making it work.  Example:

Behind the company's confident is experience with previous shortages of critical materials  In 2006, GE turned its attention to rhenium, a rare metal (but not one of the rare earths) used in engine turbine blades, after a rapid run up in prices.

Within three years GE had come up with new methods to recycle the metal grindings normally lost during manufacturing and new ways to recapture rhenium from used blades, and even developed non-rhenium alloys, that cut its usage in half.

When it comes to rare earths, GE is taking a similar approach . . . 

That's why it's GE and not some bankrupt footnote in biz history.

The rare earth fears we're watching blossom today:  expect to witness this dynamic over and over again on all sorts of materials/food/water/you name it.  And the answer will always be the same:  recycle, use more efficiently, develop slight mixed alternative or pure alternatives, etc.  And just like in "peak oil," the drivers will be the same:  a combination of rising price and emerging technologies.  Funny how that works, along with human ingenuity.

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