Rare earths producers and consumers form an action group

17 October 2012 22:15  [Source: ICIS news]

WASHINGTON (ICIS)--International producers and users of rare earth elements (REEs) on Wednesday formed an alliance to develop “a healthy and competitive global market” for those increasingly critical substances amid tightening supply conditions.

Founding members of the Rare Earth Technology Alliance (RETA) include US REE mining firm Molycorp, manufacturing giant General Electric and Belgian chemicals and plastics major Solvay.

Other members include Arnold Magnetic Technologies; Avalon Rare Metals; Boulder Wind Power; Colorado School of Mines; Global Tungsten & Powders; Great Western Minerals Group; Iowa State University; Montana Tech; Quest Rare Minerals, and Rare Element Resources.

The group will be housed and managed at the American Chemistry Council (ACC) in Washington, DC.

ACC spokeswoman Marie Francis said that the council was hosting RETA because “rare earth elements are deeply interconnected with chemicals producers, and RETA will benefit from ACC resources and management and connections with ACC members”.

The availability and cost of rare earth elements have become an increasing concern among US chemicals producers, refiners and a broad range of other manufacturers.

That is because China now produces 90-95% of the global supply of REEs, and the Beijing government has shown a willingness to use that supply in trade and policy issues and to restrict exports.

The 17 chemical and mineral substances known as rare earths are crucial to refining, petrochemicals production and other industries, such as manufacture of weapons and space systems, lasers and fibre optic communications.

Despite the name, rare earth elements are not actually rare – most of them are found in almost any soil around the world.

However, rare are those areas in which REEs can be found in concentrations that make mining them commercially feasible.

At present, there are only two places in the world other than China where REEs can be found in such economically viable concentrations: one is in a remote part of Australia, and the other is in Mountain Pass, California.

The US used to produce all the rare earths it needed up until 2002 when the Mountain Pass mine was shut down, in part because high federal and state corporate taxes and tough California environmental laws made the mine uncompetitive with much cheaper rare earths mining and production in China.

Legislation pending in the US Congress would accelerate permitting and other federal and state authorisations to renew domestic production of rare earth elements.

The National Association of Manufacturers (NAM) has warned that the tightening supply of REEs will force still more US manufacturing to relocate overseas.

Other critical applications for rare earth elements include renewable energy products, magnets, refrigeration systems, defence applications, consumer electronics, hybrid car batteries and many more.

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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