[LINK] China, Japan on collision coure over rare-earth metals

Kim Holburn kim at holburn.net
Sun May 31 17:33:34 AEST 2009


> China, Japan on collision coure over rare-earth metals
> Leo Lewis | May 28, 2009
> Article from:  The Times
> JAPAN'S increasingly frantic efforts to lead the world in green  
> technology have put it on a collision course with the ambitions of  
> China and dragged both government and industry into the murky realm  
> of large-scale mineral smuggling.
> China, Japan clash over metals looms
> Rare-earth metals are crucial to the fututre of battery-powered cars  
> Picture: Bloomberg
> The robust international trade in illegally mined, quota-busting  
> rare-earth metals highlights China's near monopoly on the raw  
> materials for environmental technology - a 95 per cent dominance of  
> world supply that is likely to become more widely noticed as China  
> tightens its grip.
> The weight and magnetic properties of rare-earth metals have made  
> them important for wind turbines, essential to hybrid cars, and  
> indispensable if the world ever hopes to covert to fully electric  
> vehicles.
> One mining company president told The Times that governments that  
> had promised a way out of economic turmoil with bold schemes to  
> subsidise green cars, solar panels and other environmental  
> technology had "spoken without understanding the upstream of modern  
> products".
> Don Burbar, the chief executive of Avalon Rare Metals, said: "The  
> crux of the matter is that there are now a lot of technologies that  
> can't work without rare earths, and China is currently in effective  
> control of the global supply. China has positioned itself to retain  
> control, and meanwhile politicians around the world do not  
> appreciate how the supply side of green technology works."
> In Japan, the world's biggest importer of rare-earth metals, more  
> than 10,000 tonnes per year about a fifth of the country's total  
> annual consumption are thought to enter the country through a  
> thriving black import network without which Japan would already be  
> in a severe supply crisis, a senior government official said.
> China has been lowering its export quotas for rare-earth metals by  
> about 6 per cent annually since the start of the decade, with Japan  
> expected to be allotted only 38,000 tonnes in 2009. Toyota and Honda  
> alone will consume about that quantity and experts in Australia have  
> predicted a wider global supply crunch within three years as demand  
> surges beyond existing refinery and extraction capacity.
> But rare-earth specialists at two of Japan's largest trading houses  
> said that loopholes and smuggling substantially raise the quantities  
> of rare metals that enter Japan each year. Kazunori Fukuda, deputy  
> director of the non-ferrous metals division at the Ministry of  
> Economy, Trade and Industry, said: "If the Chinese export quota  
> limits were the reality of what comes into Japan each year, we would  
> be even more worried than we already are. All green technology  
> depends on rare-earth metals and all global trade in rare earth  
> depends on China."
> Ginya Adachi, from the Japanese Rare Earth Association, said that  
> China's dominance of rare earths would serve the developed world  
> with a rude shock about global trade: Japan, America and Europe must  
> now realise that some markets are not real, but political. But he  
> added: "The Chinese Government wants full control but it doesn't  
> have it. It is not in control of the rare-earths market in the same  
> way that OPEC is in control of oil. Local miners will sell even if  
> the government tries to control the price or the quotas."
> The Japanese Government has begun looking for alternative supply  
> sources in Vietnam and elsewhere; rare earths are not as rare as the  
> name suggests. There are potential supplies around the world, but  
> prospective miners in Australia and the US are experiencing  
> financing difficulties and as soon as new facilities have emerged in  
> Asia and elsewhere, Chinese companies have quickly become majority  
> investors.

Kim Holburn
IT Network & Security Consultant
Ph: +39 06 855 4294  M: +39 3494957443
mailto:kim at holburn.net  aim://kimholburn
skype://kholburn - PGP Public Key on request

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