China will be important not only for cheap merchandize production, but also for raw materials, for example today’s electric cars and wind turbines rely on a few elements that are mined almost entirely in China.
Demand for these materials may soon exceed supply.
Will this be China’s next great economic advantage?
China, currently produces 95 percent of the world’s supply, but even without Chinese restrictions and with the revival of the California mines, worldwide supplies of some rare earths could soon fall short of demand.
Of particular concern are neodymium and dysprosium, which are used to make magnets that help generate torque in the motors of electric and hybrid cars and convert torque into electricity in large wind turbines.
There are no practical alternatives to these metals in many critical applications requiring strong permanent magnets—materials that retain a magnetic field without the need for a power source to induce magnetism by passing an electric current through them.
Most everyday magnets,including those that hold notes on the fridge, are permanent magnets.
But they aren’t very strong, while those made from rare earths are tremendously so.
Rare-earth magnets are found in nearly every hybrid and electric car on the road.
The motor of Toyota’s Prius, for example, uses about a kilogram of rare earths. Offshore wind turbines can require hundreds of kilograms each.
New mining activity, not only at Mountain Pass but also in Australia and elsewhere, will increase supplies—but not enough to meet demand for certain critical metals, particularly dysprosium, in the next few years.