AN ELEMENTAL ISSUE
earths. In April 2019, Kenya secured $666 million from China to build a data center in a tech city (likely comprising data centers designed to facilitate internet and communications) currently under construction in Konza, about an hour from Nairobi. Other African countries in China’s crosshairs include Cameroon, Angola, Tanzania and Zambia. Tanzania is of particular interest because of the presence of several military-critical rare earths, including neodymium and praseodymium, which are key components in precision-guided munition technology.
China has also become a significant new economic actor in Latin America and the Caribbean. China-Latin America trade increased from almost negligible levels in 1990 to $10 billion in 2000 and $270 billion in 2012; the largest portion of this exchange takes place between South America and China. In 2012, an $8.4 billion rare-earth deposit was discovered in Brazil. Over the past few years, China has become Brazil’s undisputed top trade partner.
PARTNERSHIPS TO BREAK THE STALEMATE Any efforts to boost U.S. access to rare earths require a combi- nation of technological advancement, driven by necessity, and partnerships to reach the regions where these elements are located in abundance. Fortunately, technology is providing plenty of opportunities to enhance our abilities to discover and extract rare-earth elements.
Massive deposits have recently been discovered in Japan’s far eastern territorial waters, for example, and that discovery will complicate China’s efforts to corner the rare-earth market. Experts say there might be enough yttrium, europium and terbium in this deposit to meet global demand for hundreds of years. Te only problem is that the deposits are at the bottom of the ocean. Several companies specialize in underwater mining, but the process is extraordinarily difficult, and more advances must be made to fully benefit from this discovery.
Te process for diversifying supply sources for rare earths will likely be expedited by recent events, including the recent U.S.- China trade conflict as well as China’s recent history of cutting
rare-earth exports to Japan. In 2010, China restricted rare-earth trade with Japan, a restriction that ended only after mediation by the World Trade Organization in 2014.
In addition to Japan, Australia is a potential partner for the United States that has a common interest in competing with China for rare-earth market share. Australia-based Lynas Corp. is currently the world’s largest producer of rare earths outside of China. Lynas recently announced a joint venture with U.S.-based Blue Line Corp. to develop a rare-earth separation facility in the United States. Te company currently uses a processing plant in Malaysia, and in May, Lynas unveiled plans to invest $34 million to ramp up production and allay the regulatory concerns raised by Australian shareholders that Malaysian regulations did not provide adequate environmental protection.
Other international companies could be a factor in developing alternative supply sources as well. Te Rainbow Rare Earths mining company is focused on production from, and expansion of, the high-grade Gakara Rare Earth Project in the East Afri- can nation of Burundi. Gakara, characterized by exceptionally high quality, is the only rare-earths mine in Africa and just the second outside of China.
Closer to the United States are significant deposits in Kvanefeld, Greenland. Kvanefeld’s ore reserves of 108 million metric tons support an initial 37-year mine life, and the project is expected to be one of the largest global producers of neodymium, praseo- dymium, dysprosium and terbium, along with uranium and zinc byproducts. Greenland Minerals Ltd., in close cooperation with China-based Shenghe Resources, is working toward maximizing the potential of this reserve.
CONCLUSION Te U.S. military supply chain is highly vulnerable to any Chinese efforts to limit access to rare earths. Te Chinese have already used rare-earth minerals as a weapon. Te result of the resumption of rare-earth trade was a global collapse in prices, which eliminated the incentive for private industry to perform any additional rare-earth exploration or to establish new plants
As rare-earth elements grow in importance, they have become both carrot and stick for international political trade negotiations.
92 Army AL&T Magazine Fall 2019
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