There are four steps:
- Mining.
- Beneficiation - raw dirt goes in, most of the uninteresting dirt is removed, low grade ore comes out. Mostly a mechanical process. Done at the mining site. Biggest problem is getting rid of the waste. Mountain Pass pipes it to Nevada. Really.
- Separation - low-grade ore goes in, and the various elements are separated out. Usually separate from the mine site. Currently China has over 80% of the capacity for this step. US capability in this area is weak. MP Minerals has a pilot plant. So does a startup, Ucore.[1] They claim to be scaling up. Total investment in Ucore seems to be about $55 million, which is small for the importance of this business.
- Smelting and magnet making - MP Minerals has a modest plant in an industrial park in Texas.
The US military demand for rare earths probably isn't that high compared to consumer demand.
Nobody wants to overspend, because the last two times rare earth producers overspent, the price crashed and many players went bust. The problem with this industry is price volatility vs large fixed capital expenditures. Now pricing, subsidies, and export controls are so political that volatility is worse.
[1] https://www.metaltechnews.com/story/2024/09/18/mining-tech/t...
Perhaps a few within the US bubble thought that.
From the outside the asymmetry was pretty clear, the bulk of global manufacturing takes place within China, the bulk of mining and processing of technological vital inputs was under a Chinese umbrella, and the time to rebuild manufacturing and supply pipelines was on the order of a decade plus.
The US is a customer in a world full of customers and potential trade partners, China has found other customers, trade partners have been forced to develop trade outside of former US trade agreements.
It would have taken a long term careful plan to bring back manufacturing, trade dominance and critical supply chains to the US, doable but not exactly Trump's forte.
Excuse me? As a sentence it's a fine sentence. It's not anchored in reality. Paul Krugman amongst others has been constantly reminding his subscriber list (448,000) that this is a trade war which only has losers. There is no factual basis to the assertion either only the most cynical of us, or didn't think.
This behavior to ban sales of materials needed for every advanced engine, actuator, sensor, etc. is why the Taiwan situation is fraught.
Outsourcing of everything wasn't incentivized, it was forced on the US industry by Wall Street and their Republican friends. Around 2005-2006 there were 2 Congress bills about balancing the US current trade account, both were written and sponsored by Democrats but neither could get enough sponsors for a vote.
At that time, the GOP was full speed "outsource baby, outsource" and Wall Street analysts would bury any company refusing to follow the party line.
People mistake their actions now as protectionism when it's about looting and pillaging what little is left so that they can keep their death grip on capital.
The U.S. is ran by wealthy elites, who run the U.S. in such a way to make themselves more wealthy.
Of course they would outsource every job and business related resource mining operations if that meant more profit in the short term. It’s just good business!
It's time for us to grow anti-fragility and independence. And we should expect China to do the same.
Sucks for US soybean farmers, but it would have undoubtedly happened in the future regardless.
We need to distribute critical manufacturing far and wide amongst our allies, and onshore some of the most important pieces. (Though I'm not sure the current admin considers our allies as friends, which is not a great idea during this great reshuffling.)
Now imagine if people stopped strong-arming each other.
America is a one-party state. That party is neoliberalism. On economics and foreign policy there's almost no daylight between the major parties in the US and really foreign policy is economics. Imperialism is the highest form of capitalism.
Political discourse is dominated by culture war issues not economics. Race, gender, sexual oreintation, immigration status, etc are intentional distractions designed to divide the working class while the government steals from you to give it to the wealthy. As LBJ put it:
> “If you can convince the lowest white man he's better than the best colored man, he won't notice you're picking his pocket. Hell, give him somebody to look down on, and he'll empty his pockets for you.”
Southern states were so deeply concerned that poor white people would unit with freed slaves they went out of their way to sow these kinds of racial divisions.
Why tariffs have crossed a line is because the Republicans seem to have forgotten that protecting the economic order is the point of culture war issues. You're not meant to actually start messing twith the economic order. Trade is so intertwined on the global stage that no country stands self-sufficient. China can wield an extremely large stick here. Rare earths are just the tip of the iceberg.
The US produces very little now and that's mostly weapons (and some commercial airplanes). You might say tech products but they're almost all produced in China. We have a dysfunctional economy that teeters on the brink of collapse where basics like food, water and shelter are getting out of reach for many people. Take out data centers being built and our economy is in decline and that's another theft from the public too as we're all paying for the electricity. Now that might be fine if those AI data centers actually produced something but... they don't.
The capitalist dream here seems to be to produce AI to displace workers but where does it end? Who buys your stuff if nobody has a job and those who do have no disposable income?
AI data centers, weapons and private equity firms. That's the modern US economy.
Compare that to China where the government is building infrastructure at an incredible rate and is investing in public services.
I feel like the epitaph for the United States of America will be something like "For a brief time we created a lot of shareholder value."
This feels like it can't be true. What % of "rare earths" are going into those military products? I mean those are super low volume manufacturing compared to EVs or anything consumer oriented. I'm sure there are strong magnets somewhere in a submarine but how many?
I thought "rare earths" were not rare at all. A lot of stuff is made in China because it's economical but can be made somewhere else for a bit more money. Do billion dollar fighter jets care if the magnet used in some electric motor costs $0.35 or $0.43 ?
Isn't the manufacturing issue in the US unrelated to any of this? Not enough factories, not enough skilled people, not having ramped up because munitions weren't needed?
My cursory understanding of why we don’t process this stuff anymore is environmental degradation more so than money.
Happy to ship the externalities elsewhere while it cheap and we’re on good/friendly terms.
This has all been known for over a decade but no one invested in an alternate supply chain.
As for all those EV/consumer and Mil products its not raw RE being utilised but speciality alloys that are worked to produce whatever the material science requires , where once again there one industrial producer.
Thats what the whole chain part of supply chain comes in , similar to why its easier and cheaper to manufacture iphones in Schenzen; all the refining/alloys/smelting is in one location with the skilled workforce and advanced methods that have been iterated over the last 30 years.
As to what % go into mil products, several kilos of this several of that forged into speciality alloys at commodity prices vs doing it at artisinal mining prices and those billion dollar weapon systems become tens or hundred billion dollar systems.
[0] That rename was the best gift Trump has given the international community so far.
It is a bit late to use Taiwan and Ukraine as justifications for the US using a military solution. It isn't winning these fights.
Buttons840•1h ago
johng•1h ago
GenerWork•1h ago
No matter if it's called a threat or a vulnerability, hopefully this'll spur more action towards moving away from China for raw earths and magnets.
LPisGood•1h ago
I’ve done offensive security work and worked on defensive security systems professionally. It seems to me like there’s a certain less technical side of computer security that cares a little too much about making definitions and checkboxes - when I get asked in an interview if I think threats or vulnerabilities are a bigger issue I know that job is not a good fit.
tw04•1h ago
GauntletWizard•1h ago
petersellers•1h ago
bigfatkitten•1h ago
In this case, the vulnerability is the opportunity.
juusto•15m ago