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Rare earths market must be kept open

By Patrick Burnson, Executive Editor
September 22, 2011

Concern that the United States will fail to maintain an adequate supply of the minerals needed to manufacture our most advanced products is gaining traction in Washington.

Congressman Don Manzullo (R-IL), Chairman of the House Foreign Affairs Subcommittee on Asia & the Pacific, held a hearing to highlight the fact that China controls 97 percent of the rare earths market and has been limiting exports and skyrocketing costs of the minerals to the detriment of manufacturers in the U.S. and other countries.

As logistics management sources have been noting, rare earths are vital in a variety of advanced manufactured goods, such as cell phones, fluorescent lights, hybrid engines, airplanes, wind turbines, and defense guidance systems. 

China’s actions to temporarily ban exports of rare earths a year ago following a territorial dispute with Japan caused huge price spikes for certain rare earths, particularly cerium, neodymium, and dysprosium.  Currently, the prices for these elements are at astronomical levels. As a result, U.S. manufacturers can no longer expect a steady supply of these elements, and the pricing uncertainty threatens tens of thousands of American jobs. 

According to Manzullo, the U.S. Department of Energy is conducting cutting edge research into rare earth alternatives, but a more comprehensive effort is needed.

“Congress, the Administration, and our manufacturers need to come together to formulate a comprehensive strategy to end China’s monopoly on rare earths, from challenging China’s trade actions to encouraging more American production of rare earths. We must end our reliance on China for the building blocks of advanced U.S. manufacturing. American jobs and our national security depend on it.”

About the Author

Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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