Seminar paper from the year 2012 in the subject Politics - Topic: Peace and Conflict, Security, grade: A-, Utrecht University (Roosevelt Academy), course: Security in the Post-Cold War Era, language: English, abstract: Rare earth metals are chemical elements which are widely unknown to the general public but nevertheless can be found in everyday life. They are critical components of digital cameras, rechargeable batteries and magnets, of surgical lasers, polishing powders and military tanks. Even though their name suggests differently, they are not specifically rare but they often only exist in small deposits scattered over the globe which makes mining often fairly unprofitable. From 1986 onwards China established itself as the biggest producer of rare earth metals with by 2010 supplying 97% of world demand (Humphries, 2011, p. 13). In the past five years prices have been seen to increase tremendously and during the Senkaku boat collision incident, China imposed a trade embargo for rare earth metals against its opponent Japan. The question is to what extent China is going to use its dominant position in the future, specifically in regard to one of the biggest rare earth metal consumer, the United States. In the following the question whether China’s monopoly is indeed a serious threat to U.S. security will be answered. Therefore, first a detailed definition of rare earth metals and their applications and a historical overview will be given. Thereupon, it will be shown that China’s monopoly is indeed a security issue by a review of the relevant body of security literature, specifically the Copenhagen school approach. Afterwards the possible solutions will be examined.

"Currently, the U.S. along with most of the industrialized world depends almost exclusively on Chinese imports of rare earth elements for this crucial resource in the manufacture of vital components found in both commercial and defense products. Subsequently, China's monopoly of the rare earths industry has ramifications for not only the U.S. commercial manufacturing base but also for its military. Recent history has shown that China is not averse to leveraging its advantage with regard to rare earths production and exports to hold a trading partner hostage against a political backdrop vis-à-vis Japan in 2010. This fact coupled with a growing internal appetite for rare earths to fuel its ever-growing economy has resulted in China cutting its export quotas significantly over the last several years. Due to these factors, the U.S. faces a situation where its own security may be at risk due to a lack of access to a strategic resource, especially one that is controlled by a potential adversary in the future. The U.S. must develop a strategic plan to address the issue either through the use of stockpiling, recycling, indigenous production, combining efforts with its closest allies, or a combination of the four to ensure the U.S. military never faces a shortage of critical weapons or systems required to win its nation's wars."--Abstract.

Rare Earth Elements are a group of 17 metals which have a central role in modern industry, increasingly used in the fields of green technologies, high technological consumer goods, industrial and medical appliances and modern weapons systems. Although deposits of Rare Earths are globally dispersed, over 90% of global demand has been provided by Chinese mines since the late 1990s, leading to a situation where China has a virtual monopoly. This book surveys the Rare Earths mining industry, discusses the extent to which Rare Earths really are scarce elsewhere in the world and assesses the economics of production, considering arguments for the rationing of supply, for higher pricing and for a total export embargo. This actually occurred in 2010, demonstrating the vulnerability of the rest of the world to China’s control of these increasingly vital resources.

Resource competition, mineral scarcity, and economic statecraft -- What are rare earths? -- Salt and oil : strategic parallels -- How China came to dominate the rare earth industry

Over the past few years, the Chinese government has implemented a number of policies to tighten its control over the production and export of "rare earths"--a unique group of 17 metal elements on the periodic table that exhibit a range of special properties, such as magnetism, luminescence, and strength. Rare earths are important to a number of high technology industries, including renewable energy and various defense systems. China's position as the world's dominant producer and supplier of rare earths (97% of total output) and its policies to limit exports have raised concerns among many in Congress, especially given the importance of rare earths to a variety of U.S. commercial industries (e.g., hybrid and conventional autos, oil and gas, energy-efficient lighting, advanced electronics, chemicals, and medical equipment), as well as to U.S. defense industries that produce various weapon systems. Many are concerned that rising rare earth prices could undermine the global competitiveness of many U.S. firms (lowering their production and employment), impede technological innovation, and raise prices for U.S. consumers. Others are concerned that China's virtual monopoly over rare earths could be used as leverage against major rare earth importers, such as the United States, Japan, and the European Union (EU). ...

Over the past few years, the Chinese government has implemented a number of policies to tighten its control over the production and export of "rare earths"-a unique group of 17 metal elements on the periodic table that exhibit a range of special properties, such as magnetism, luminescence, and strength. Rare earths are important to a number of high technology industries, including renewable energy and various defense systems.