According to Reuters, on the 14th local time in the US Senate, Republican Senator Tom Cotton and Democratic Senator Mark Kelly proposed a cross-party support bill that will forcibly prohibit defense business contractors from purchasing Chinese rare earths before 2026 and use the Department of Defense to establish a standing inventory of strategic mineral materials. The bill essentially leverages billions of dollars in U.S. Department of Defense purchases of fighter jets, missiles, and other weapons to require contractors to stop relying on China and extend further to support the resumption of U.S. rare earth production.
The United States is a country with few rare earth reserves, and a large number of rare earths in the United States need to be imported from abroad. The U.S. rare earth reserves, which had 13 million tons in 2009, fell to 1.8 million tons in 2015 and only 1.4 million tons in 2019. However, the United States is a military power, and weapons and equipment such as aircraft carriers, radars, nuclear submarines, and fighter jets are inseparable from rare earths. It is said that it takes 417 kilograms of rare earths of various elements to build an F35, samarium and europium for the reactor to shield nuclear radiation, and a Virginia-class nuclear submarine that uses up to 4 tons of rare earth metals. Contemporary main lasers are based on neodymium-yttrium-doped aluminum garnet, and the key component of the US military's thermal imager, the non-chilling focal plane array, is inseparable from the rare earth element lanthanum.
Kelly and Cotton proposed this bill to get the US military equipment out of dependence on China's rare earths, and instead support the US rare earths and achieve "rare earth independence". In their eyes, this bill is the latest law in the United States to curb China's near-control of the rare earth industry. But the question is that the bill can pass, and how the United States can solve the problem of getting rid of its dependence on China's rare earths is the key to the problem. There is currently only one rare earth mine in the United States and does not have the capacity to process rare earth minerals. China is the country with the largest reserves of rare earths in the world, with reserves of 44 million tons, accounting for 36.7% of the world's total reserves of rare earths, and 17 rare earth elements such as lanthanum, scandium and yttrium are available.
The more important reason is that China is not only rich in rare earth reserves, but also China's rare earth purification and processing capacity is indeed unattainable by the United States. China's rare earths have always been selling valuable resources cheaply because they have no pricing power in the world. Before 1988, China's export price of rare earths was $10,000 per ton, which fell to $9,900 per ton in 1991 and $9,100 per ton in 1996. In 2002, China's export price of rare earths fell to $3,600 per ton. It can be seen that China, which has lost its pricing power, can only suffer losses in the field of rare earths, so China began to integrate its own rare earth resources.
Recently, China Minmetals Rare Earth Group, China Rare Earth Co., Ltd. and China Southern Rare Earth Group will merge to form China Rare Earth Group Co., Ltd., which is responsible for the mining and processing of rare earth ore in the southern region. Coupled with the North China Rare Earth Group, Among the world's six major rare earth manufacturers, China controls more than 80% of the rare earth market. This means that China will have the bargaining power of rare earths in the future international market, and China's rare earths will not be sold cheaply in the future. While the United States sees China integrating rare earth export enterprises, the United States is more worried about being necked by China's rare earth card in the military industry.
So the United States wants to establish its own rare earth industry, but the problem is not that the rare earth reserves on the earth are small, but it is difficult to extract them. China concentrates rare earth minerals on a world-scale scale, and China's competitive advantage is precisely to master effective extraction and processing technology. Because rare earths will cause a lot of environmental pollution in the mining process, coupled with the fact that the United States no longer has rare earth purification technology, the United States mainly relies on rare earth raw materials needed from abroad. However, from a safety and ecological point of view, rare earth mining and processing is a very complex process. At present, the only raw material source in the United States, the Yamaguchi Rare Earth Mine in California, also transports its raw materials to China for reprocessing.
The United States simply does not have processing capacity at all, and the first problem to be solved by Kelly and Cotton proposed such a bill is that the United States should solve the problem of rare earth purification processing technology, rather than the real bill problem. What they are thinking about is that in the context of the deterioration of Sino-US relations, the United States has repeatedly mentioned the need to establish independent supply chains that bypass China, but the problem is that it is impossible to "return to the old business" in the short term. After all, if the huge industrial chain wants to be built in the short term, technology will become the key, and the time and cost will be very huge.
Therefore, for the United States, in the short term, it will not be able to get rid of its dependence on China's rare earths, and the only way is to import a large number of Chinese rare earths as strategic reserves. In this way, it provides the necessary rare earth elements for the US military equipment, and buys time for the technological breakthrough and industrial chain construction of the United States. Otherwise, all bills will not solve practical problems, after all, real problems cannot be solved by one bill. (The picture in this article comes from the network)