Japan over a barrel when it comes to rare earth metals


Rare earth metals, used in a wide range of products, are making headlines these days amid an attempt by China, which controls 97 percent of their global production, to allegedly halt exports to Japan over a territorial spat.

Before shipments reportedly resumed Wednesday, manufacturers in industries signifying the heart and soul of the Japanese economy went into temporary shock because of their heavy reliance on the hard-to-find minerals.

Here are some basic facts about rare earth metals:

What are rare earth metals and what are they used for?

They are a group of 17 different minerals, extracted from the Earth in powder form. They are used in magnets, batteries, liquid crystal displays, various electronic components and as catalysts used in everything from automobiles to oil refining.

The end-users include automakers, electronics manufacturers, and the makers of computers and industrial robots.

“A rare earth metals shortage affects all kinds of industries,” said Kanmaterial Corp. Chairman Katsuyuki Matsuo, who works with major Japanese trading houses to import the metals from China.

“It’s difficult to escape the influence (of the ban) because, for example, cars, computers and mobile phones use rare earth metals in many different components.”

Where are they found?

According to the U.S. Geological Survey, 124,000 tons of rare earth elements were extracted around the world in 2009, among which 120,000 tons, or 97 percent, were from China, 2,700 tons from India and 650 tons from Brazil.

Despite the name, however, rare earth elements aren’t all that rare. A USGS report says that in 2009 the world had 99 million tons of rare earth reserves, of which 36 million tons, or about 36 percent, were in China, 19 million tons in the former Soviet Union and 13 million tons in the U.S.

Why is production so low compared with the size of the reserves?

The USGS report says: “Rare earths are relatively abundant in the Earth’s crust, but discovered minable concentrations are less common than for most other ores.”

Countries including the U.S. and Australia are trying to increase production, but Matsuo of Kanmaterial says it would be very difficult for them to match China’s low production costs, mainly because the geological distribution in those countries is relatively spread out.

Why is Japan so dependent on China?

Japan imports about 80 percent of China’s rare earth exports, Kanmaterial’s Matsuo said.

This isn’t because other countries use extremely few rare earth metals. Rather, it’s because Japanese companies don’t want to build processing plants in China out of fear their technology may leak, Matsuo noted.

In 2009, China exported about 40,000 tons of rare earth metals, or a third of its production, according to Matsuo. The remaining 80,000 tons were consumed within China by domestic companies and by those of German and other countries that own mineral processing plants there and export components that use rare earth metals, he said.

“It is no exaggeration to say that Japan is the only country inconvenienced by restrictions on Chinese exports of rare earths,” Matsuo said.

Is it possible to use alternatives?

Matsuo says yes, but he isn’t sure how effective they would be because there are no final products that use only one kind of rare earth metal in any single component. Manufacturers are developing alternative materials little by little, he said.

According to an employee of a magnet maker who asked for anonymity, some types of rare earth elements used in combination, such as terbium and dysprosium, strengthen magnets. They are essential in manufacturing tiny and strong magnets used in small electronic devices, such as mobile phones.

Matsuo said it probably makes more sense to tap known reserves than to seek out alternatives.

How much do rare earth metals cost?

A few dollars to a few hundred dollars per kilogram, according to Matsuo. Neodymium is relatively expensive because it is used for many things, such as magnets and small motors.

What are the names of all 17 rare earths?

Cerium, dysprosium, erbium, europium, gadolinium, holmium, lanthanum, lutetium, neodymium, praseodymium, promethium, samarium, scandium, terbium, thulium, ytterbium and yttrium.