“The heavy rare earth element is added as a fragrance, a dopant to keep the magnets magnetic at high temperatures. It also improves the corrosion resistance of magnets and the lifespan of magnets throughout the ages,” said Seaver Wang, director of the Oakland Institute-based climate and energy team.
In addition to magnets, these rare earth elements can provide a range of purposes, such as making metal stronger, improving radar systems and even treating cancer. Without them, in many cases, the technology infrastructure and consumer gadgets will not be able to execute at the same level, but they will still maintain their basic functionality. “Wind turbines will be out of service 10 years ago; electric vehicles won’t last that long,” Wang said.
Lange agrees that the effects of losing weight rare earth elements will be manageable for U.S. companies. “The place where that rare earth is in your car is the motor that pulls up and down the window,” Lange said. “There are ways to deal with something less interesting, like rolling windows by hand.”
Vulnerabilities and solutions
In the past, China’s key mineral restrictions have been ineffective. One reason is that American companies that want to buy rare earth minerals can first go through an intermediary. For example, according to trade data, Belgium has become possible to re-export hubs through the first restriction of mines in 2023, from China to the United States. Because the EU is more closely linked to Washington than Beijing, it is difficult for the Chinese government to effectively stop this trade process.
Another sign that China’s export control measures are not very effective is that prices of key minerals have only risen slightly since the policy was first implemented, indicating that supply levels have remained stable. “Nothing they did in 2023 really changed the status quo of the market,” Lange said.
But China’s latest restrictions are more extensive, and there is already some evidence that this time the situation may be different. Companies that need these elements have been forced to buy them from other existing private stocks, which have become more valuable in recent weeks. “Currently, the price is rising very much and can attract inventory,” Bascalan said, speaking with rare earth traders.
However, in the long run, companies may be able to find technical solutions to potential rare earth minerals. Tesla, for example, announced in 2023 that it has reduced its use in EV motors by 25%, and plans to get rid of them completely in the future. The automaker has not clarified what it uses for, but experts speculate it may turn to other magnets that do not rely on rare earths.
Where are the mines in the United States?
Although rare earths or generally well-established minerals are often referred to as industries in the United States that want to re-move, the challenges associated with bringing each industry back are very different.
Unlike manufacturing advanced semiconductors, it requires the use of hundreds of millions of dollars of complex machinery and building extremely complex factories, critical minerals are not difficult to produce. The technology to dig and improve them is mature, with some of these large amounts of natural sediments in the United States and Canada. But the mining industry was introduced to the West because it did not generate much value and was extremely polluted.
