America and China are ready to destroy the world market

Written by The Frontier Post

Sergey Savchuk

If anyone had hopes that stormy 2021 would at least at the end slow down in terms of breaking geopolitical and market axioms, then they were in vain. In the new year, mankind enters under the mournful crackle of rules that have been diligently imposed over the previous decades.
European Commissioner for Internal Market Thierry Breton said that the European Union will begin to implement a set of measures in the coming days to reduce its own dependence on the supply of rare earth metals from China.
He is echoed by the President of the European Commission Ursula von der Leyen, clarifying that the modern European production of complex electronics, electric cars, the production of environmentally friendly hydrogen and metallic silicon for the manufacture of solar panels is critically dependent on China, with which the collective West has far from cloudless relations.
Officials did not outline the specific steps that Europe is ready to take, but given that there were statements about the need to guarantee a complete chain of production and supply, it can be assumed that the European Union plans to dramatically tighten the rules for the export of rare earth stocks and production.
Let’s give credit to the leaders of the Old World, they did not lie. Sometime until the mid-eighties of the last century, the United States was the leader in the extraction and extraction of rare earth metals, but then China seized the palm, leaving no chance for anyone. Today, during the explosive growth of complex energy and reso-urce-intensive industries, the PRC, according to various estimates, controls abo-ut 80-90 percent of the wor-ld market for rare earths.
Here we need to digress and clarify some basic facts: without this, the intensity of the West-China confrontation will not be clear.
The International Union of Applied and Theoretical Chemistry classifies 17 elements as rare and rare earth metals. These are scandium, yttrium and 15 lanthanides, including niobium, tungsten, lithium, zirconium, rhenium and others. As you might guess, rare earths got their name for a reason. In the earth’s crust, they are found more often than, for example, the same gold, but their total reserves are very small, and extraction from the ore mass is a very costly process in all respects. The world ‘s total reserves of rare earth metals are estimated at just 120 million tons, of which more than 44 million are in China.
It is followed in descending order by Russia, Canada, Australia, Brazil, India and Vietnam. About Russia a little lower, but for now, about the production of final products.
At the end of 2019, the PRC produced 132 thousand tons of rare earths, that is, Beijing controls 62 percent of the world market. Further, with a huge lag, is the United States: 26 thousand tons and a modest 12 percent, but here you need to understand that the United States receives a significant part of the final metals from China, for example. That is, the original ore is mined in America, then sent to Asia, and after processing at the Chinese mining and chemical enterprises in the form of finished metal it floats back. Even the conclusion of a truce between Washington and Beijing after a protracted trade war did not solve the problem. In October 2020, President Trump, by his decreeintroduced a nationwide emergency regime for the mining of rare earth metals. A year has passed, there is already a different leader in the White House, and the echoes of the transcontinental struggle are now covering Europe, which, faithful to its allied duty, is building very cool relations with China.
The latter, taking advantage of his dominant position and the current global crisis, directly affects the international market and hints that a bad world is better than a good quarrel.
For understanding, we will give a brief reference to how many branches of modern industry cannot exist without a constant supply of rare earths. Niobium, tungsten, lithium and their “colleagues” from the number of rare metals are indispensable in the production of semiconductors and superconductors, modern steels, including alloys for the nuclear and aviation industries, a wide range of glasses, batteries, capacitors, satellite guidance systems, rocket engines, X-ray devices, infrared and fiber optics, lasers, LEDs, microprocessors and high-octane gasoline. They have found their application in medicine: rhenium is used to treat tumors, and zirconium is used for prosthetics.
In 2019, 38 percent of all rare metals were spent on the manufacture of permanent magnets, 23 percent on the production of chemical catalysts, 13 percent was consumed by the production of polishing powders for glasses and abrasives, metallurgists and electric car manufacturers took another nine percent of the total share.
As you can see, an entirely complex science-intensive production with a high final cost of production, without which no state can rightfully be considered industrially developed.
Against the backdrop of similar statistics and global trends, Western countries, which for decades had fought for a free market and reproached Russia for trying to monopolize gas supplies, began to do exactly the same thing, only in a multiple amount.
In early December, the United States Geological Survey (USGS) announced the creation of USA Rare Earth, which is tasked with meeting at least half of the country’s needs for rare and rare earth metals. In fact, we are talking about the planned creation of a monopoly, because USGS has given over to its brainchild the Round Top field in Texas, known for having large gallium reserves in the amount of 35 thousand tons. Thus, Washington cuts off any other investors from this source and closes the production-extraction-use cycle exclusively on itself.
It would be foolish to think that China did not know about the impending steps and did not provide for countermeasures. A week later, the Chinese State Asset Management Commission (SASAC) released a statement on the merger of four large profile companies into one under the common name of China Rare Earth Group.
The horizon of her mission is no secret. The holding company controlled by the Chinese government should become a leading company, covering at least 90 percent of the mining of rare earth metals, and this, given the degree of China’s consolidation of the global market, makes it not even a regional, but immediately a global dominant. However, let’s return to our native spaces.
We are usually put at the bottom of the list of countries with rare and rare earth metals, which is fundamentally wrong. The Russian Federation owns a raw material base of rare earth metals, which is one of the largest in the world: its volumes are estimated at 27 million tons. Thirteen of the seventeen deposits store half of all our rare wealth, and among the largest are Seligdarskoye, Belozimi-nskoye, Chuktukonskoye, Ulug-Tanzekskoye, Lovozerskoye and Yaregs-koye. The problem is that t-hey are practically not wor-ked out, and for this reason Russia holds only two percent of the world market.
Exactly one year ago, in December 2020, the Ministry of Industry and Tradepublished a development program for the industry of rare and rare earth metals. It provided that by 2024 the Russian industry should reach the level of 20 thousand tons, and already in 2030, over 70 thousand tons of production of such demanded metals. The implementation of such ambitious plans requires appropriate funds – the ministry has estimated the package of required investments at 284 billion rubles, of which 62 should be allocated by the state, and the rest is on the shoulders of private investors. The project included development of the Zavitinskoye and Kovykta lithium deposits, Tomtorskoye, where it was supposed to produce ferroniobium, the Zashikhinskoye deposit with its niobium, tantalum, zirconium and titanium, as well as a number of others, including facilities in Chile and Congo.
These plans were canceled out by the pandemic and Western san-ctions, which were superimposed somehow very selectively. For example, due to the difficulties, the corporation was forced to withdraw from the project at the Tomtor field. “Rostec “, which, however, retained its projects for the extraction of beryllium and germanium at the Malyshev-sky mine and the Pavlovsky brown coal deposit in Prim-orye. Other potential players, for example, Rosatom, Atomredmetzoloto and others, have faced no less difficulties. not to be unfounded, to talk about the implementation of this program would be at least premature.Our industry simply does not have so many workers and money.
However, when difficult times are over and there will be enough hands and finances, Russia should no longer pay attention to the teachings of its Western partners and should do exactly what they do.

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