Rare Earth Elements

The Impact of Chinese Export Restrictions on Rare Earth Elements

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rareearthblog_2010-12-16REEs (rare earth elements or rare earth metals) are in the news lately because China has developed a dominant supplier position and has severely restricted exports.1 What makes this newsworthy? Because REEs are essential to the production of many high-tech products.2

REEs are a group of 17 elements (scandium, yttrium, and the 15 lanthanides) that have become essential in applications such as superconductors, rare-earth magnets, electronic components, catalytic converters, hybrid cars (batteries and magnets), opto-electronics, and various critical defense industry applications (night vision goggles, range finders, radar, etc;). While they’re a critical part of high-tech applications, usage requirements vary. For example, a handheld device might use only 0.3g of REE, while a hybrid car might use tens of kgs—and awind turbine might require 1000kg.4, 5  Yttrium is used in semiconductor equipment components for its resistance to plasma.

During the 1960s, 70s, and 80s, the USA was the dominant supplier of REEs. However, China entered the market in the 1980s, and it is now the dominant (>90%) supplier.4   The reason for China’s dominance is economics, not abundance.4, 6 Mines all over the world were closed when China undercut world prices in the 1990s.4 Significant deposits are present in 14 states, Australia, Canada, Asia, and significant quantities are accessible through recycling.4, 7  The challenge is that a fully functional supply chain would require up to 15 years and a great deal of capital. Further, REE production has serious environmental risks that must be managed.4, 7 

In Congress, there is currently a bill before the House (RESTART: Rare Earths Supply-Chain Technology and Resources Transformation Act of 2010)1 that could restart American REE production. It must, though, compete with politics, deficits, and environmental concerns, which are hard acts to follow.

Given the current world economic situation, China is likely to maintain its dominant market position in the near future.  The question is: How will that dominance affect strategic considerations for industries and governments?

(Note: It’s important to remember that CIGS are not the same as REEs. CIGS is an acronym for a group of elements (copper-indium-gallium-selenium) that have shown promise for efficient solar cells deposited on plastic substrates. CIGS are available from a range of sources, and production seems likely to remain comparable to demand.3 )



  1. A. Madrigal,  http://www.theatlantic.com/technology/archive/2010/09/worried-about-chinas-monopoly-on-rare-elements-restart-american-production/63444/
  2. R. Speigel, http://www.edn.com/article/511666-Electronics_industry_braces_for_rare_earth_materials_shortages.php
  3. https://www.glewengineering.com/blog/bid/38890/CIGS-Solar-Cells-Is-there-sufficient-gallium
  4. http://en.wikipedia.org/wiki/Rare_earth_element
  5. http://en.wikipedia.org/wiki/Lanthanide
  6. http://en.wikipedia.org/wiki/Abundance_of_elements_in_Earth’s_crust
  7. K. Comisso, http://www.newscientist.com/article/dn19753-us-reserves-of-rare-earth-elements-assessed-for-first-time.html


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