CHINA’S NEAR MONOPOLY ON MINERALS

 

Perhaps Trump should consider adding “Dig, Baby, Dig” to his “Drill, Baby, Drill” policy   Nancy 

The Risks Of China’s Near-Monopoly On Minerals Are Worrisome

Posted on Wednesday, July 17, 2024
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by Outside Contributor
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The scarcity of mineral supplies due to worsening relations with China is an open and alarming question.

The problem is that China dominates the global production and supply of 30 out of the 50 minerals the Department of Energy considers essential. These minerals, ranging from lithium and cobalt to rare earths, are crucial for national security and the transition to a green economy.

Consider rare earth metals such as dysprosium, lanthanum, and cerium, integral to laser-guidance systems for weapons, jet fighter engines, anti-missile defense systems, and smart bombs. The United States relies on China for 70 percent of its rare earths — and an even greater share of other critical minerals.

Who dares claim that trade embargoes are relics of the past? China holds the power to halt mineral exports at a moment’s notice. Over the last year, it has imposed export controls on gallium, germanium, and graphite — all minerals essential for weapons production and energy transition technologies.

Most U.S. imports of these minerals come from China. Furthermore, China has banned the export of rare earth extraction and processing technology. Its next move could be to restrict exports of metals like copper and lithium, which are crucial for electricity transmission and the production of batteries for electric cars.

What is disturbing about our predicament is that over the last 30 years, we have neglected opportunities to reduce our dependence on China. The United States boasts immense mineral resources — worth an estimated $6.2 trillion. To leave them untapped is sheer folly. While Canada and Australia have continued to harness their mineral resources, the United States has failed to fortify its supply chains and protect against China’s potential export curbs.

The U.S. willingness to offshore large parts of our industrial base has inherent risks, starkly exposed by the pandemic, especially in strategically valuable industries such as mineral production and processing. U.S. production has ceased entirely for some minerals, and inventories in the National Defense Stockpile have dwindled since the 1950s, impairing its ability to satisfy mineral demand for key sectors during a national emergency.

In 2023, the Defense Department estimated that, in a “base case” national emergency scenario such as a U.S.-China conflict, the U.S. military would face shortfalls in 69 minerals.

While momentum is building to reshore mineral production, it faces two equally daunting challenges: Chinese efforts to quash international competition and misguided domestic opposition to new mining.

Environmentalists determined to block the opening of new U.S. mines disregard the adverse consequences of their actions for national security and the fight against global warming. Those who advocate sourcing minerals from other countries ignore the fact that the global supply network has become increasingly vulnerable.

Demand for minerals essential to clean energy technologies — from solar panels and wind turbines to batteries and electric vehicles — is exploding. Already alarmingly high, U.S. mineral import reliance is poised to worsen. We are rapidly exchanging our dependence on OPEC’s oil market dominance for Beijing’s dominance of mineral markets, and the stakes are colossal.

Changes must be made to ease the flow of capital into mining and spur the development of domestic mineral supply chains. Without such actions to strengthen domestic mining and processing, our manufacturing and energy future — and our national security — will increasingly rest in the hands of the world’s mineral superpower, China.

Dan Ervin, Ph.D. is a finance professor at Salisbury University. He writes on energy economics and policy with a focus on nuclear power. He wrote this for InsideSources.

Reprinted with Permission from DC Journal – By Dan Ervin

 

 

 

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