How Rare Earth Mining Companies Are Changing the Investment Landscape

Utah may contain one of North America's largest rare earth deposits; however, mining there would require costly and hazardous processes.

Governments worldwide worry that relying too heavily on China for rare earth metals will inhibit digital advancement and sustainability initiatives in their countries, so companies are working hard to bring production and processing closer to home.

1. China’s Consolidation

Rare Earth elements--a group of 17 silvery-white metals--first came into widespread prominence during 1939 when chemist Frank Spedding used them to purify uranium for nuclear fission, helping the Manhattan Project build the first atomic bomb. Their newfound popularity made these elements ubiquitous across high tech products but their high price tags deterred many mining projects from mining them.

That was until 2012, when a World Trade Organization complaint by the United States and Japan forced China to loosen its export quotas and prices declined dramatically, prompting companies like Molycorp to reopen its Mountain Pass Mine in California but continue shipping most of its semi-processed ore to China for processing.

Nowadays, the mountains north of Lingbeizhen no longer echo with the sound of bulldozers and trucks; instead they feature bamboo bushes clinging to ravines, navel orange trees, tropical pines growing on terraces cut into the rock slopes, black rubber hoses and PVC pipes peeking out from under weeds as reminders of former activity here.

MP Materials has received funding from the Department of Defense to design and build two separation plants that will extract rare earths used in permanent magnets found in electric vehicles and consumer electronics from production sites that may otherwise compete on price alone. MP Materials has taken steps towards being eco-friendly with its production sites such as those found at MP Materials which is using grant money from DoD for neodymium/praseodymium production to produce permanent magnets found within consumer products like electric vehicles and consumer electronics.

http://chinese.wsj.com/gb/20101008/rec151012.asp?source=MoreInSec

2. The Race for Africa

Rare earths are an elite set of 17 elements valued for their electrically conducting and magnetic properties, used widely across products including electric vehicle motors, wind turbine generators and smartphones. Unfortunately, their high price and scarcity make mining operations challenging due to resource intensive operations with potential environmental risks associated with mining processes.

Responding to rising demand for their resources, mining companies are seeking ways to cut costs and increase efficiency. Lynas' largest rare earth production facility located in remote Western Australia employs one such strategy by extracting metals from fossilized lava preserved within ancient volcanoes - this helps both reduce costs while simultaneously lessening environmental impact.

Though this approach to mining operations may help, it won't solve every problem facing the industry. With demand for clean energy technology increasing rapidly, political pressure may increase for nations to produce these minerals domestically; as demand does so too will pursue mines more aggressively.

Even while healthy competition on green energy and minerals is beneficial for all parties involved, Risi cautions that it must not become an zero-sum game. Countries should work together to ensure they don't limit each other's progress while simultaneously supporting research that uses less rare earths or substitutes them with more abundant ones - as well as recycling efforts for electronic waste.

http://investingoldorsilverlntb021.yousher.com/making-a-purchase-in-precious-metals

3. Environmental Issues

Rare earths (REEs) aren't really rare: They're found throughout Earth's crust in low concentrations and often indistinguishable from each other, making mining them messy and costly. Mining them doesn't produce usable magnets for use in electric vehicles, jet fighters, or drones directly; rather they must first be processed through toxic chemical processes to produce magnets needed by electric vehicles, jet fighters, or drones - steps which release harmful toxins into water supplies and contribute to ecosystem destruction - prompting protest from local residents there.

Rare earths have become a crucial component of modern industry despite their environmental concerns, with smartphones not functioning nearly as brightly or running faster, hybrid cars less fuel-efficient and fiber-optic cables offering less capacity to carry calls or internet data. But as demand signals for rare earth technologies increase, so too has pressure for domestic supply chains.

The US is working toward that end through legislation which would create a Department of Defense stockpile and require defense contractors not to purchase rare earths from China, but this may not be sufficient; according to one researcher from Defense Advanced Research Projects Agency, companies wanting to keep more rare earths domestic will have to invest in innovations like using microbes instead of toxic chemicals for sorting rare earths from one another and refining them into useful products.

4. Policy Changes

Rare earth elements (REEs) are an indispensable component of modern technologies used by consumers and businesses worldwide - from smartphones to magnets that power electric vehicles. Unfortunately, Beijing holds nearly all mining operations and refining capacities for REEs - controlling 87% of the global market! (see figure).

Nations have made efforts in recent years to open new mines and level the playing field, but most projects have fallen flat; Molycorp, once owner of Mountain Pass Mine in Colorado, filed for bankruptcy in 2015. Even if companies could find ways to produce more metals in an environmentally sustainable manner - with minimal environmental damage - competition would remain stiff due to China using its market power to subsidize production and lower prices.

Biden administration policies aim to break Beijing's REE monopoly through domestic supply chains, with MP Materials becoming the first such company through SPAC merger and planning to bring rare earth processing back to America at their Mountain Pass mine in California.

Sloustcher announced that his company recently entered an agreement with General Motors to provide magnets for its new electric vehicle programs beginning late 2023, starting later. Over time, they intend to increase U.S. capacity as part of a complete REE supply chain, said Sloustcher.