U.S. News


Mineral Exposure: Foreign Reliance on Vital Rare Earth Elements Demands Innovation

With every day seemingly revealing a tragic new milestone in the global struggle against COVID-19, it is hard to think more than a few days ahead. The past few weeks and months have scarred the entire world. Our present time is aptly described by Vladimir Lenin’s characterization that “there are decades when nothing happens, and there are weeks when decades happen.”

And yet, planning for the future will soon be a necessary exercise. One of the facets that will need to be examined is the reality that the United States lacks the domestic supply chain necessary to rapidly-produce many of the essential materials—low-tech and high-tech alike—that are needed during this crisis. Past thinking focused on the ability to address idiosyncratic disruptions—political crises in certain countries, or localized natural disasters— via an efficient, globally distributed supply chain; when the risk is manifested as a global phenomenon, however, this brittle arrangement proves very costly. As we overcome this dramatic shock, Washington will need to determine which supply chains and resources must be hardened, diversified, or “onshored.”

One key category that will be part of this discussion will be rare earth elements (REEs). REEs are some of the most important—and underappreciated—strategic resources that modern society relies on to enable technology. REEs comprise 34 naturally-occurring elements used in devices ranging from batteries and computer memory to displays and motors. It is worth underscoring the vital role they play in the fielding of defense systems as varied as radiation detection systems, electronic jamming tools, and advanced munitions. While REEs represent only a small fraction of most items’ total mass, they are essential for their operation.

Dispersed throughout the earth’s crust, REEs are generally not found in sufficient concentration to make their collection economically attractive. While the U.S. sustained a domestic REE industry for portions of the 20th century, various factors—including the environmental impact and labor costs—contributed to a gradual shift toward overseas extraction and production.

Today, the U.S. is “almost 100% dependent on foreign [REE] sources,” according to Jim Reilly, the director of the U.S. Geological Survey. China, notably, produces roughly 90% of the global supply and dominates the supply chain associated with the production of REEs. The country extracts REEs from its mines, undertakes the intermediate extracting and refining activities, and, ultimately, manufactures many REE-powered end products. In fact, the one REE mine operating in the U.S., Mountain Pass in California, must ship its raw product to China to be processed.

At a time of increasing competition and economic brinkmanship, this reliance on foreign REEs poses a threat to the U.S. Last May, amidst tense trade negotiations between the two countries, Chinese President Xi Jinping visited Jiangxi province, a region heavily focused on REEs, subtly signaling the country’s dominance of this strategic resource. The message was clear: we are not limiting REE exports at this time, but we could—and it would hurt.

This reliance poses a significant but underappreciated threat to the U.S.’s economic and national security. Even if Beijing were not to use its virtual-monopoly on REEs as an economic weapon, the U.S. is still exposed to unanticipated supply chain disruptions. We need not look further than the impact of the COVID-19 epidemic on China’s industrial output to recognize the risk of reliance. The U.S. and partner states should be doing more to diversify the production of REEs.

To its credit, in recent years, the U.S. government has stepped up efforts to address this challenge. The Army will fund construction of a commercial processing plant for a specialized class of REEs used in defense applications; this is the Army’s first such investment in REEs since the Manhattan Project. At the same time, a pilot plant is setting up operations in Colorado to process small batches of REEs, slated to start later this year. Meanwhile, new partnerships are being inked with Australia and Canada, with future opportunities sighted in Greenland. The Trump administration, as part of a strategy to “ensure secure and reliable supplies of critical minerals,” has committed to expedite the permitting of new projects and grow the REE labor force.

These are all worthwhile efforts, but more innovative approaches are also needed. Specifically, the government should be funding research to mitigate (or render obsolete) traditional, environmentally-damaging sourcing techniques. Some examples of these approaches might include harvesting REEs from recycled electronics, developing synthetic REE alternatives, or developing REE-linked end-products—such as magnets and alloys—that require fewer resources. Research is beginning to bear promise, but commercial interest for this research—particularly with REE prices at relatively low levels—has not materialized. The government has an essential role to play in funding research that could generate not only economy-wide benefits but also strengthen security by reducing reliance on a vulnerable supply of strategic resources.

Strategic resource vulnerability—and a science-led effort to overcome it—is a challenge the country has faced before. During the Second World War, the global supply of rubber was heavily concentrated in Southeast Asia. Following Japan’s conquest of these rubber-producing colonial territories, dire shortages confronted the country, as discussed in Daniel Immerwahr’s How to Hide an Empire: A History of the Greater United States. A national speed limit of 35 miles per hour was imposed to reduce wear on car tires, while officials worried there may not be enough rubber to produce baby bottles. The U.S. government energized industry to innovate and develop synthetic alternatives, allowing the country to dramatically ramp up production in its factories to exceed national requirements. As Immerwhar discusses, “just one [synthetic rubber] plant, which might employ 1,250 workers, made enough rubber to replace a rubber plantation that had 24 million trees and a workforce of at least 90,000.” Across a range of raw materials—silk, tin, copper, and many others—the U.S. successfully “replaced colonies with chemistry.”

Of course, the circumstances today are vastly different from 1940’s America; fortunately, we are not menaced by the specter of a global war (at least not one against our fellow man). It is clear, however, that reliance on foreign sources of REEs needlessly imperils the economy and national security. Fostering new approaches will not only help break a worrying resource stranglehold but also potentially help mitigate the harsh environmental impact of traditional approaches. As was the case with rubber and countless other raw resources: we have done this before, and we can do it again.