Don’t Panic about Rare Earth Elements

August 27, 2021

By Jeremy Hsu via Scientific American

A laborer works at the site of a rare earth metals mine at Nancheng county, Jiangxi province in China. Credit: Jie Zhao Getty Images

The materials used in iPhones and Tesla cars need not become a long-term casualty of a U.S.-China trade war

As trade tensions rise between the U.S. and China, rare earth minerals are once again in the political spotlight. Today Chinese mines and processing facilities provide most of the world's supply, and Chinese leader Xi Jinping has hinted about using this as political leverage in trade negotiations with U.S. President Donald Trump's administration. But in the long run, many experts say the global market involving these materials would likely survive even if China completely stopped exporting them.

The 17 rare earth elements, which cluster near the bottom of the periodic table, play a vital role in several industries: consumer electronics including Apple AirPods and iPhones, green technologies such as General Electric wind turbines and Tesla electric cars, medical tools including Philips Healthcare scanners, and military hardware such as F-35 jet fighters. The U.S. government lists them among minerals deemed critical to the country's economic and national security, and the Trump administration notably exempted rare earth elements from tariffs it imposed on $300 billion worth of Chinese goods. On the other side of the trade conflict, Xi recently made a politically symbolic visit to one of China's main rare earth mining and processing facilities, and China used tariffs of its own to target a U.S. rare earth mine in California. Such political posturing on both sides, however, may overemphasize the world's reliance on China's supply of rare earth elements.

"Politicians get too alarmed or too wrapped up in the idea of political manipulation of markets," says Eugene Gholz, an associate professor of political science at the University of Notre Dame. "There's a big difference between individual companies making or losing money, and the large-scale ability to get political influence in this particular market."

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