From cars and construction equipment to cell phones and military weapons, rare earth materials are critical to manufacturing many important things businesses and consumers use on a daily basis.
While people around the world rely on these minerals in their everyday lives, China produces 80% of the U.S. rare earths and has been doing so for quite some time. What’s made things even worse over the past 12 to 18 months is a global pandemic.
Many consumers stuck at home decided that their current cell phone or computer needed to be replaced, which ultimately caused a shortage of these materials that is affecting various other sectors including the automotive and electronic industries.
Expanding the supply chain means the production of at least 17 minerals indispensable to manufacturing both consumer and government necessities would not be solely sourced from China. However, this won’t happen overnight. The process of having a fully diversified supply chain is several years away due to the planning, process and permitting it takes to both open a mine and build a factory.
New Rare Earth Production Will Open the Global Supply Chain
Fortunately, new entrants into the market have begun mining projects throughout the world that are mining for tungsten, one rare earth particularly in demand for important items. This is extremely important as China has limited the amount of tungsten exports that can be shipped to the U.S., which has caused a great deal of concern regarding the overall supply chain of this rare material.
Tungsten is used in the construction and content of both semiconductors and anodes. It’s also used in a wide array of products from the filament of light bulbs, electric furnaces, and X-rays for medical and industrial imaging, to lead-free fishing weights and golf clubs, and drill bits and saw blades. In fact, tungsten is also used for the production of glass syringes – a product that has become very high in demand during a global pandemic that relies on the worldwide distribution of vaccines.
This is why it’s imperative to diversify the supply chain for rare earth materials like tungsten. Efforts made by new mining projects throughout the world will increase both supply levels and exports back to or within the U.S., which will benefit the overall supply chain of tungsten for production and manufacturing.
One mining project in South Korea is of particular importance. The Korea Tungsten project in the Sangdong Mine hosts one of the largest tungsten resources in the world. This mine was the leading global tungsten provider for more than 40 years and has the potential to produce 50% of the world’s tungsten supply. The project is steadily becoming the center of focus for resource experts, miners, investors, shareholders around the globe.
What the Future Holds for the U.S.
US President Biden is working hard toward a significant infrastructure plan that is also meant to serve as 50% cut in emissions by 2030. The infrastructure proposal includes $174 billion in spending to create electric vehicle charging stations in addition to other roadway enhancements while also touting both tax incentives for electronic vehicle battery makers for building factories and the creation of new manufacturing jobs in the U.S.
However, 70% of the world’s EV batteries are still currently built in China because that’s where most of the materials used to build them are located. Until the new rare earth production players are up-and-running in mining and manufacturing, there remains an immediate issue for those working in the coal mining and traditional auto manufacturing industries when it comes to making a pivot in their careers to clean energy sector that is to come in the U.S.
Even so, the future of mining and manufacturing rare earths remains to be seen in the U.S. While China dominates a majority of rare earth mining and manufacturing, their domination didn’t happen overnight.
For approximately 30 years, China has been building its supply chain in addition to re-evaluating it every one to five years. With export restrictions to the U.S. now hindering the demand of popular consumer goods and materials, it’s important for the U.S. and other countries around the world to evolve and diversify their own supply sources, but it will take time to make the change.