Colorado company trying to dent Chinese dominance in rare earths
A Greenwood Village-based company’s plan to reopen a rare-earths mine in California is taking shape even as the world’s largest exporter of rare earths is hoarding them.
China, which supplies 95 percent of the rare earths used around the world, is using its rare earths to attract manufacturing, rather than shipping it out to be used in manufacturing processes elsewhere, Jim Sims, vice president of corporate communications for Molycorp Inc., told the Grand Junction Area Chamber of Commerce on Wednesday.
It’s possible given the rate by which China is reducing exports and the rapid growth in demand for rare earths that China could quickly become a net importer, Sims said.
China’s new policy combined with growing demand for rare earths played roles in the company’s plans to reopen its mine at Mountain Pass, Calif.
Rare earths, dismissed as useless to manufacturing only decades ago, now are required for most if not all of the trappings of the electronic age.
“There is virtually no piece of electronics or high technology that does not work without rare earths,” Sims said
Rare earths are the reason that smart phones are small enough to fit in pockets or be hitched to a waistline, he said. In addition to consumer electronics, they also are necessary for modern military high technology and most everything in between.
Rare earths, also called the lanthanides, aren’t necessarily rare. One of them, cesium, actually is the 25th most-abundant element on earth.
Rare earths, however, are extremely difficult to produce from the rock that contains them, Sims said, so tiny concentrations don’t allow for economic production.
Molycorp (NYSE: MCP) is completing its $731 million plant and is gearing up for production, anticipating that environmental measures it undertook to obtain permits from California will actually result in lower costs rather than the higher ones that had been anticipated, Sims said.
Those cost reductions will allow Molycorp to sell rare earths at less than half the price demanded by the Chinese once the plans open next July, Sims said.
Even with Molycorp in production, the company anticipates that global demand will outstrip both its output, as well as that of any Chinese exports, Sims said.