The new U.S. plan to rival China and end cornering of market in rare earth metals

August 26, 2021

By Samantha Subin via CNBC News

A wheel loader operator fills a truck with ore at the MP Materials rare earth mine in Mountain Pass, California, January 30, 2020.

While companies like Lynas and MP Materials are eager to ramp up the domestic supply chains, extracting rare earths is a difficult process due to a combination of environmental, technical and political factors. Many regions, including the European Union, have an abundance of these resources but lack the expertise that other countries like China have in the processing and magnet production, Nakano said. 

The rare earths industry has come under fire for environmental concerns. Many rare earth elements reside among mineral deposits with radioactive materials that can leach into the water table. Mining, processing and disposal can also contribute to ecosystem disruption and release hazardous byproducts into the atmosphere. 

Although the U.S. is making strides to advance the rare earths supply chain and develop alternatives to mining rare earths, environmental regulations are often more stringent than inside China. In recent years, Lynas came under scrutiny from activists and the Malaysian government for radioactive waste that it produces as part of its enrichment process. Lynas has said that the low-levels of radioactive waste were not dangerous and the Malaysian government ultimately renewed the license and green-lighted a construction plan for a permanent disposal and waste treatment facility in August 2020.

Some companies have proposed extracting rare earths from coal, while others suggest setting up a system for recycling old batteries or disk drives. Suggestions include calls to utilize shipping services like Amazon or USPS to set up a recycling system, but these endeavors can be costly, Nakano says. Recycling of key raw materials used in the EV space is receiving greater investment focus. Some emerging battery recycling leaders include Redwood Materials, a start-up from former Tesla CTO JB Straubel, and Li-Cycle, which recently announced plans to go public through a SPAC-merger.

The Ames Laboratory in Iowa is one of the many Department of Energy’s national laboratories working on projects aimed at substituting rare earths or finding new, more eco-friendly methods to recover them. One initiative by researcher Ikenna Nlebedim is a rare-earth magnet recycling process designed to recover rare earth oxides, without the hazardous acids or fumes associated. Scientists are also using the process to recover byproducts like copper and nickel. Another laboratory in Idaho is looking at how potato wastewater can be used as a cheap food source for a bacterium that can assist in recycling rare earths.

“We already have the magnets here,” says Tom Lograsso, director of DOE’s Critical Materials Institute at Ames. “Why can’t we just retain that and close the circle domestically rather than throwing them in a landfill.”

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