Can America Regain the Rare Earths Crown?

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"A rare earth element is like air. It's only important when you are running out."

U.S. & REEsWith China cutting exports while controlling 95% of the world's production of rare earth elements (REEs), the U.S. and other countries suddenly finds themselves vulnerable. Countries from around the world now realize the future of their high-technology industries could be in the hands of one supplier—China.

In the U.S., this realization comes at a time when the Obama administration has committed the U.S. to replacing more than a million gasoline-powered cars with hybrid and electric cars by 2015. These cars—referred to as "green" vehicles—use A LOT of rare earth elements in their power trains. Reducing the US’s reliance on foreign oil is one motivation for moving to green cars. However, given the current situation, and unless alternative supply sources are found—soon—it appears that the U.S. might be replacing a dependence on one commodity (oil) for reliance on a much more difficult to find and more expensive one

Somewhat belatedly, the U.S. has discovered the looming crisis in rare earth availability and has only recently begun to look at securing domestic supplies and rebuilding its supply chain.

Scrambling to Catch Up

The U.S. is scrambling to get back in the game. However, ramping up a dormant industry is costly and requires a great deal of time. Obtaining a mining license and the associated environmental permits is like a regulatory equivalent of a very long cross-country steeplechase.

Restarting a mine is no easy task. Environmental regulations in 2010 are considerably more stringent than they were back in the 1970s and costs are multiples of what they were.

Given its past dominance, it is argued the U.S. has the reserves and capacity to more than meet its domestic needs. . .Much is riding on how the U.S. weathers the next few years.

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