The REE Dilemma: Trading OPEC for China
Source: The Cutting Edge, Cindy Hurst (11/8/10)
"The U.S. can free itself of 'dictators and autocratic kingdoms.'"
Woolsey compared oil to salt. Through the end of the 19th Century, salt was considered a strategic commodity, making it a source of conflict because it was needed to preserve meat. It was only through such innovations as refrigeration, freezing, etc. that salt was finally stripped of its strategic value, ending the salt wars.
Today, we are faced with a new issue—the ever-increasing concern over energy security. As anxiety over energy security and global warming rose during the 21st Century, the concept of green energy became increasingly prominent. Not only do they reduce the consumption of fossil fuels, but they're also viewed as more environmentally friendly.
Unfortunately, green technologies are turning out to be not that simple. Green technologies rely heavily on rare earth elements (REE), and China dominates the REE industry.
In 2008, the global REE consumption rate was approximately 124,000 tons. Of that, 74,000 tons were consumed by China; 24,500 tons by Japan and 15,500 tons by the U.S. By 2014, global demand is projected to be 180,000–200,000 tpy, with Chinese supplies falling short of global demand.
Countries have been scrambling, trying to secure adequate future supplies of REEs.
In March 2010, Congressman Mike Coffman introduced a bill, the Rare Earths Supply Chain Technology and Resources Transformation Act (RESTART) of 2010, aimed at re-establishing a competitive domestic REE supply chain.