China Begins New Export Restrictions on Rare Earth Deposits

(Graphic courtesy of "Rare Earth Elements--Critical Resources for High Technology," Gordon B. Haxel et al., U.S. Geological Survey, November 2002)

If you're in the ceramics manufacturing industry (and if you're not, I wonder what you come to this blog for, hopefully for my charming writing style) then you are aware that rare earth metals are instrumental in many advanced materials processes. Businessweek has recently predicted in an article that a resource dispute between China and the United States may be fast approaching. As is depicted by the graph above, in recent years China has been climbing the rankings of the nations with the most rare earth elements, and now that they are on par with and surpassing the United States, they have a very large bargaining chip when it comes to these deposits of rare elements.

China has opted to cut export quotas by 72 percent in the second half of 2010. This means that it's likely that the US will have a shortage of rare earth elements in the coming months, which could be potentially disastrous to our industry, and possibly the world economy as a whole. What this means for local ceramics manufacturers is that they'll need to modify their budgets to accommodate the extra prices on importation of these rare elements. According to an article on these new developments by Ceramic Tech Today "China's Ministry of Commerce says shipments for the second half of 2010 will be limited to 7,976 metric tons, less than half of the amount shipped in the first half of the year (16,304 metric tons)."

With all of the recent technological developments in ceramics and materials science, this news could not have come at a worse time. With the United States' economy not in tip-top shape and effecting the rest of the world, the limited resources of each country are becoming more and more important to global markets. The dispute that might occur could have far-reaching consequences throughout the entire world, and ceramics manufacturers everywhere should begin to consider re-estimating their costs and estimated production values.