Chivalrous Island: Chinas rare earth trump card has not yet come out of the hand table that first panicked.

category:Finance
 Chivalrous Island: Chinas rare earth trump card has not yet come out of the hand table that first panicked.


The U.S. Department of Commerce has issued the Federal Strategy to Ensure the Safe and Reliable Supply of Key Minerals

Antecedents

Where does the supply come from? The top producer of 19/35 minerals is China, while the top supplier of 13/35 minerals is China, too.

Net Imports of Key Minerals in the United States in 2017

Face up, China ranked 20 times in the list of importing countries of nearly 40 minerals; Lizi, rare earth, bismuth, antimony, scandium, barite and other imports from China accounted for more than 50%, of which scandium is 100% to be brought from China.

The situation is not optimistic, and Trump, whose trade campaign is booming, has already issued a presidential executive decree to seek a reassuring pill to reduce the dependence on strategic mineral imports.

The report of the U.S. Department of Commerce is a response to the Presidents executive order, which contains six action plans, 24 goals and 61 specific recommendations.

In highly concise Chinese, some people find that self-isolation from the world is similar to self-destruction and panic.

How to deal with it? Of course, we should first think about ruts.

rategy

For example, as the first of the six programs of action, Promoting the transformation of research and development deployment of key mineral supply chains, the three survival directions are quite clear: first, to open up sources, i.e., to explore a variety of key mineral sources in the United States; second, to reduce expenditure, to process, manufacture and recover minerals more effectively, thereby minimizing waste; third, to prepare similar substitutes for scarce minerals. Lets wait till tomorrow.

Naturally, the classic brand of allied warfare is also indispensable. This report details how to strengthen international trade and cooperation related to key minerals, such as Canada, Australia, Japan and South Korea, which are desperately pulling aside when the storm is approaching.

The areas of cooperation include, but are not limited to, identification and exploration of key mineral resources, processing and recovery of key minerals, reduction of supply risks and prevention of supply chain disruption, and even joint follow-up and sharing of foreign investment and acquisition information.

At the same time, the report also calls for improving the understanding of key mineral resources in China. According to the priority, at least once every two years, the national or regional assessment of key mineral resources in potential deposits will be completed. It is not only understanding, but also making full use of the Purchase of American Products Act to strengthen domestic procurement and promote its own mineral production.

Finally, administrative procedures have been warned by the U.S. Department of Commerce not to delay this time. Land Administration, Forestry Bureau, etc. should review the areas currently withdrawn or protected from development to assess whether these restrictions should be lifted or reduced.

Is it a gallop? Or panic?

On the periphery of the report, interest has not diminished.

As far as the United States is concerned, the amnesty for Chinese rare earth imports into the United States is also the margin that it has to keep.

After all, U.S. warplanes and missiles are on the rare earth front line, from Lockheed Martins F35 to guided missiles and target-setting lasers, all depending on rare earth to perform key functions.

In addition, according to reports from the Congressional Research Service Center, rare earth elements, including yttrium and terbium, are used for laser targeting and weapons for future combat system vehicles; and rare earth elements are indispensable for Stryker armored vehicles, Predator UAVs, Tomahawk cruise missiles and even ordinary radar and sonar.

In addition to rare earths, other key minerals reported by the US Department of Commerce have also come a long way.

For example, magnesium is listed as one of the six key minerals vital to the United States, and China is its main producer. From aerospace to armored vehicles, from guns and artillery to missile ammunition, from optoelectronic instruments to military computers, sense of existence brushes everywhere; tungsten produced and supplied by China to the United States in large quantities is widely used in the field of ammunition due to its high density and hardness; and fluorite, for example, is widely used in the field of ammunition. Widely used in metallurgy, aluminium smelting, glass, ceramics, cement, chemical industry...

It is worth noting that four of the six key minerals mentioned above in the United States have an average net import dependence of 50%.

A screenshot of the U.S. Trade Representatives announcement on May 13 made it clear that the products to be taxed did not include drugs, specific medical products, rare earth materials and key minerals.

How to apply R&D results? Fifty pages of the report have not yet reached the point of building a high house. It is interesting to see when the door of the laboratory will open to the world. The only certainty is that the manufacturer is in no mood to wait. After all, according to the report, key mineral industries in the United States are at all stages of manufacturing advanced technological products such as mining, separation, metal reduction, alloying and high-performance rare earths. They all experienced layoffs, business failures and production line shifts.

On this point, American businesses and the media are quite clear.

Citigroup said the United States has no ready-made way to break its dependence on Chinas rare earth supply; James Kennedy, president of ThREE Consulting, a rare earth industry-focused company, also wrote that the United States is focused on rare earth mining rather than the entire supply chain, while China, from 2011 to now, has more rare earth patent applications in China than in other countries in the world. And.

When will we catch up? More than three years ago, the United States Government Accountability Bureau published Rare Earth Materials: Developing a Comprehensive Approach to Help the Department of Defense Better Manage National Security Risks in Supply Chains, which responded that the United States may have to wait 15 years to rebuild its domestic supply chain of rare earths.

In the meantime? The U.S. Department of Commerce has not forgotten to mention the episode in 2010 when China banned the export of rare earths to Japan. In addition to Significant Shock, the cut-off may lead to despair.

The research scope is similar to that of the U.S. Ministry of Commerce, such as the general situation of strategic mineral resources in the upper, middle and lower reaches and the operation of the industry, international trade, domestic and foreign cooperation, and providing suggestions to improve the guarantee capacity of rare earth and other strategic mineral resources.

Source: Chivalrous Island Responsible Editor: Wang Xiaowu_NF