The Diplomat: Rare Earths in the U.S.-China Trade War
The strategic importance of rare earths to the U.S. is high.
Adamas Intelligence managing director, Ryan Castilloux, was recently interviewed by Trans-Pacific View author, Mercy Kuo, of The Diplomat about the strategic and commercial importance of rare earths to the U.S. amidst the ongoing U.S.-China trade war.
Among the points emphasized by Adamas:
- Because rare earths are used so widely in commercial and defense technologies, and supply is dominated by a single nation, the strategic importance of rare earths to the U.S. is high.
- Should China feel that it is not being taken seriously amidst the ongoing trade negotiations or should the U.S. take actions that China considers provocative or disingenuous, China could opt to outright halt exports of rare earths to the U.S., or simply restrict exports to certain companies or industries, including the defense industry.
- Historically, rare earth mining practices in China did not place a lot of emphasis on recovery and storage of radioactive waste, resulting in highly-publicized environmental destruction and water pollution that has broadly given the global rare earth industry a bad reputation. Fortunately, practices are rapidly improving in China, but the legacy of destruction remains.
- The Mountain Pass mine in California is the lowest-hanging fruit available to the U.S. in the near term. However, because the mine is minority owned by a Chinese company, U.S. policymakers and the security community have been cautious to put forward solutions or policies that hinge on its output. It’s become an elephant in the room that no one wishes to acknowledge.
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