So much for free trade. China's Ministry of Industry and Information Technology is weighing a total ban on exports of rare earth metals, naturally occurring materials that are necessary for the production of next-gen batteries, hybrid cars, smartphones, and precision weapons technologies. Unfortunately for the rest of us, China mines 95% of the world's rare earth metals, mostly in Inner Mongolia, making the specter of an outright ban downright frightening.
The proposed ban would completely restrict any export of terbium, dysprosium, yttrium, thulium, and lutetium, while restricting other metals like neodymium, europium, cerium, and lanthanum to a combined export quota of 38,580 tons. That's not a lot for a planet full of starved economies trying to jumpstart their manufacturing sectors.
For China, of course, the move isn't about driving up prices or holding the world hostage, but about limited resources and soaring demand. China is pushing toward an energy efficient future on many fronts, and the government feels Chinese industry will need these minerals to make its next great technological and cultural leap forward.
Terbium is a key ingredient in the low-energy light bulbs China hopes to install in every light fixture nationwide in coming years. Cerium and lanthanum are critical to diesel engines and catalytic converters, and every Toyota Prius requires 25 pounds of rare earth metals. Neodymium enhances the power of industrial grade magnets and is a crucial ingredient in hard-disk drives, while europium is used in lasers. Everyday objects ranging from Blackberries to plasma TVs to cellular telephones contain small amounts of rare earth metals.
It's not all bad news though; China put several global competitors in the rare earth metals industry out of business in the early 1990s when it flooded the market with its ample reserves, driving prices into the ground. One such mine, at Mountain Pass in California, is being reopened by Molycorp Minerals. Other nations will likely follow suit, finding their own way to resources they previously purchased abroad and stimulating domestic mining exploration. But rare earth minerals are difficult to find, and even more difficult to extract. So while the proposed ban doesn't mean rare earth metals will dry up outside of China, it does signal a new turn in the global resource narrative; we may be approaching an era where even the wealthiest nations can't get their hands on certain materials at any price.