Claudia Luna palencia
et’s talk about highly coveted minerals, and they are neither gold nor silver. In the remainder of the 21st century, the next wars could be unleashed not only over oil or water, but also over the ambition to possess the so-called rare earths.
So far, seventeen metallic elements have been identified as rare earth elements (REE), including fifteen lanthanides: lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium and lutetium, to which are added yttrium and scandium, for a total of seventeen.
In the last three decades, they have gained particular relevance as the digitalisation and technification of communications advances, and their role is becoming increasingly important, because they are essential for mobile phones, technological devices, tablets and all the gadgets that are reshaping the information age among human beings.
The US Geological Survey explains that these minerals are used to manufacture more than two hundred products, not only for computers, but also for electric and hybrid vehicles; the new flat screen monitors and televisions.
And they are even involved in warfare. In the bloody invasion of Ukraine, its military forces are trying to repel the invasion of Russian troops with equipment, military weapons and drones also made from rare earths. So are lasers, sonar systems, radar, touch screens, precision weapon sights, and guidance and geolocation systems.
A simple magnet is the most everyday example of what a rare earth is for, and in its most sophisticated version, a tablet or a GPS dashboard in a vehicle would not be possible without it.
But are they really so rare? Geologist Manuel Regueiro points out that rare earths are not really “earths”, but a very diverse group of chemical elements.
“They are not so rare either, as some are quite abundant, as is the case in particular with cerium, which is very present in the earth’s crust and is very similar to copper,” he points out.
Why are they called rare earths? In Regueiro’s opinion, it is because in the history of chemistry, oxides were classified as earths and this group of elements began to be called that way; and over the years, especially in the current era, they have become a highly prized commodity.
The Colegio Oficial de Geólogos de España explains that they are mainly oxides and minerals, most of them associated with four types of rocks: 1) carbonatites, igneous rocks with 50% carbonates located in Mongolia at the Bayan Obo deposits and in the United States at Mountain Pass; 2) alkaline igneous rocks such as those prevalent in Lovozero, Russia in a deposit of nepheline syenites; 3) laterite clays abundant in southeast China with exploitations of more than 250 deposits; and, 4) monazite deposits found at Matamulas in Ciudad Real, Spain.
Geologists are also exploring the seabed for potential rare earth veins. In fact, the Belgian company Global Sea Mineral Resources (GSR) intends to start operating the first commercial deep sea mine in 2027, with the aim of extracting the marine sediment. An activity that Greenpeace activists warn will only lead to further deterioration of marine flora and fauna.
The International Seabed Authority and GSR signed a three-year contract on 14 January 2013 to carry out “prospecting and exploration for polymetallic nodules” on 76,728 square kilometres of seabed “in the eastern part of the Clarion Clipperton Zone” located in the central Pacific Ocean.
The economy of the present, but essentially that of the immediate future, will depend to a large extent on rare earths, as companies involved in technology, new technologies and digital technologies are well aware.
So far, China leads the world’s production of rare earth oxides, estimated at 168,000 metric tonnes (MT) per year. Five-year plans include accelerating the pace of exploration and production of such minerals.
The Observatory of Economic Complexity (OEC) indicates that in 1993, China produced 38% of the world’s rare earths production, followed by the United States with 33%, Australia with 12%, and Malaysia and India with 5%, respectively. However, since 2010, China’s economy has taken off significantly to such an extent that it has become the main producer and exporter, although under Xi Jinping’s government, the amount of rare earths allowed to be exported has been increasingly limited because they are prioritising their accumulation.
What is the global production of rare earths? Data from Investing News indicates that, in 2021, production of rare earth metals reached the 280,000 metric tonne (MT) quota.
The ten countries considered in the top ten of the production of these minerals in 2021 are: 1) China, with 168 thousand MT; 2) United States, with 43 thousand MT; 3) Myanmar or Burma, with 26 thousand MT; 4) Australia, with 22 thousand MT; 5) Thailand, with 8 thousand MT; 6) Madagascar, with 3, 200 MT; 7) India, with 2 thousand 900 MT; 8) Russia, with 2, 700 MT by the way the government of Russian dictator, Vladimir Putin, is giving tax incentives and loans for more Russian companies to join the exploration and production of rare earths. The goal is to move from having a global production share of 1.3 to 10% by 2030; 9) Brazil, with 500 MT and recently discovered an important deposit of rare earths valued at 8.4 billion dollars; 10) Vietnam, with 400 MT the government aims to increase exploration and production because based on the UN’s Agenda 2030 it wants to massify solar panels.
Melissa Pistilli, editor of Rare Earth Investing News, explains that in recent years the demand for metals is increasing as renewable energy becomes more important worldwide.
“Rare earths such as neodymium and praseodymium, which are important in clean energy applications and high-tech industries, are in the spotlight, particularly as electric and hybrid vehicles gain popularity,” she says.
Competition to own them (rare earths) creates inevitable growing friction: “Ongoing tensions between the US and China, along with other socio-political factors, are affecting the prospects for investment in rare earths. Given that China is by far the world’s largest producer of materials, the tense relationship between the countries is drawing attention to the disruption of the global supply chain in the rare earths industry”.
If China is the leading producer and exporter, the US economy is a major importer of rare earths; thus, it is feeling the full brunt of the global instability in markets caused first by the pandemic and second by Russia’s invasion of Ukraine.
The clearest example is in the production of smartphones. Unusually, last November, the US company Apple warned its customers that there would be delays in both production and sales of the iPhone 14.
The International Data Corporation (IDC) reports that Apple sold 50.4 million units between July and September 2021, making it the second best-selling company behind Samsung with 69 million units and China’s Xiaomi in third place with 44.3 million handsets.
However, in the last few months of last year, Apple has encountered difficulties in the assembly line of its devices due to a lack of supply of chips and screens.
Canadian Geographic magazine published by the Royal Canadian Geographical Society takes an inside look at a smartphone to help people understand the potential power of rare earths.
Its fundamental components are made from the following elements: 1) tin, used in an oxide that allows the screen to function as a touchscreen; 2) neodymium, disposium and praseodymium, used to make magnets that make the phone vibrate; 3) aluminium shapes the glass in many smartphones and is also used in the battery casing; 4) praseodymium, gadolinium and neodymium are used for speaker magnets; 5) terbium, europium, dysprosium, praseodymium, lanthanum and yttrium are used to create the bright colours on the screen; and, 6) precious metals such as copper, gold and silver are used for the phone’s microelectrical components.
The new blood diamonds
While China holds supremacy in rare minerals, other players will eventually join the competition, and an analysis by The Brookings Institution foresees the future in the production of these precious minerals, with Africa shining brightly.
Economist Gracelin Baskaran points out that these seventeen metals “are critical to human and national security” and will unleash fierce competition for them.
“Worryingly, production of these rare earth minerals has remained concentrated. China has a dominant position in the market, indeed, in the face of growing geopolitical tensions over China and Taiwan, we see the United States, Australia, Canada and other countries seeking to reduce their dependence on China as a source of rare earth production and processing,” she says.
And in this geopolitics and geoeconomics, African countries will play a relevant role, as Baskaran explains: “With their rich endowment of key commodities, African countries can take advantage of this search for new sources of rare earth elements to generate much needed revenues to finance basic socio-economic goals and reduce poverty, use the African Continental Free Trade Area (AfCFTA) to enhance wealth generation, and strengthen global trade partnerships”.
The researcher points out that Africa’s full potential in rare earths is largely untapped due to low levels of exploration. It lacks money and targeted programmes.
According to the Brookings study, sub-Saharan Africa’s mineral exploration budget – in 2021 – was the second lowest in the world: about half that of Latin America, Australia and Canada, despite having three times the land area of Canada and Australia.
That year on an annual basis, Canada’s exploration budget increased by 62%, followed by 39% in Australia, 37% in the US and 29% in Latin America. The budget for Africa grew by only 12%.
“And the vast majority of exploration continues to focus on gold, rather than rare earths or green metals critical to the clean energy transition.
Expanding exploration is critical to enable Africa to identify and extract rare earth elements; several rich deposits have already been found,” according to Baskaran.
Africa must use resources strategically to build strong commercial partnerships and strengthen its presence in global value chains, particularly with the United States, the EU and Australia. Yet neither Russia, much less China, nor the growing presence of radical jihadist extremism that controls several regions – along with their value chains – will want to be left out of Africa’s future take-off. And that will bring many new global tensions.
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