Rare Earths – Unshackling the Monopoly
Rare earth elements (REEs) are vital for the switch to clean energy, EVs, consumer electronics, defense equipment, and more. Rare-earth magnets are stronger per unit of weight and volume than any other type. Clean energy technologies, such as large wind turbines and electric vehicles, use rare-earth permanent magnets. The supply is controlled by a single country and amidst an ensuing geopolitical crisis, what are the next steps?
Global warming and climate change have made an adequate presence for nations and governments and consumers to start acting in an overdrive mode. The current millennium has witnessed a concerted effort in the development and application of new technologies. According to the International Energy Agency, clean sources like solar, hydro, and wind, hydro infrastructure are expected to rise exponentially in the coming years and this will lead to a surge in demand for critical minerals in the coming decade. These critical minerals include a whole list and rare earths are one of them.
What are rare earths?
Rare earths are neither rare nor earths. They are a group of 17 metals that include lanthanides, scandium, and yttrium and are critical components of at least two hundred products and devices across a vast range of high-tech applications.
These elements are called rare as methods of extracting them and subsequent treatment are very complex and costly. Even though they are relatively abundant in the Earth's crust, they are widely dispersed, according to the US Geological Survey (USGS). That means it's difficult to find a substantial quantity of the elements together and ready to extract.
The demand for rare earths
The last two decades have also witnessed a spike in the applications of rare earth elements in green technology devices such as EVs, mobile phones, rechargeable batteries, autocatalytic converters, super magnets, mobile phones, LEDs, semiconductors, and more. These metals have a vital application in these devices and as is obvious, demand for these devices is growing at a phenomenal rate. Given their deep need and importance, these elements have earned the sobriquet of “vitamins of the modern industry.”
In such a scenario, the availability and supply of rare earths across borders must be smooth and cooperative for the higher-order objectives to be achieved. That is not always the case as is evident in the last decade.
Managing the Fault Lines
Trade wars between the USA and China are a matter of grave concern that can have catastrophic consequences across the globe. Tariffs and embargoes are a natural fallout of geopolitical tensions that need to be managed carefully for the greater good of the global economy and consumers.
Australia and the USA are large producers but pale significantly when compared to the reserves and production capabilities of China. At 120,000 tons, China is a monopoly in the supply and distribution of rare earths that even the USA cannot ignore.
A 2019 Bloomberg report outlined a Chinese decision to restrict rare earth exports to the U.S. Japan was also affected by such fallouts and had to depend on other sources to keep its high-tech industry running. It is actively pursuing plans to curtail Chinese dependence by 2025 to less than 50%.
Disrupting the Supply Chain
There are nations that have proven reserves of rare earth elements and if successfully extracted can sustain the demands of European and American markets. Preliminary reports suggest that ocean bottom-REE resources could be more promising than resources on land.
This can help break the monopoly of China and the geopolitical conflict paradigm. But mining them from a viability perspective. It involves sustained and complex research and that is not all. These elements are unique in their nature of deposit formation. Hence techniques for extraction in one geography cannot be replicated elsewhere. Given the drastic urgency and industrial demand, technologies should be available soon.
Earlier this year, the US administration released plans to develop a complete domestic supply chain for rare earth magnets through a new processing facility in Mountain Pass, California.
Lynas Rare Earths, a large Australian company was also assigned a project to spruce up production. Lynas was also awarded another contract to construct the first commercial heavy rare earth elements separation facility in the U.S.A.
Most companies in the US or Europe need to protect supply chains from geopolitics as the U.S., Australia, or other countries might take up to a decade to contribute effectively to demand imposed by the value chain.
What the world needs as of now is a viable alternative market that can provide supplies that are not susceptible to cross-border government policy disruptions and economic blackmail.
The Case for Urban Mining
Only 1% of rare earth elements are recycled. As a result, aggressive methods are used to obtain them, such as extraction through organic solvents, magnetic separation, or at high temperatures of around 1,000 degrees. the extraction has a high environmental cost. Some of the processes use acids for separation and the combustion with high temperatures emits CO2 and which is detrimental from an environmental perspective.
The vast deposits of e-waste that are abundant in rare earths are growing across the world. Many countries nations have gauged the impact that urban mining can generate for a dependable supply of rare earths. Electronic waste can theoretically fulfill a sizable demand.
However, recycling of these elements is complex and challenges abound. These rare earths are not recycled in volumes mainly due to the unviable economics of cost and yield. Global investments in the extraction of these elements can soon help to catapult secondary production as a strong source of supply across the globe. These studies include automated approaches to disassembling electronic scrap, as well as technologies in chemistry for secondary extraction.
Greenscape is a leading player in the urban mining sector and one of the pioneers in the recycling of e-waste.
