The price of rare earths has skyrocketed. And China wants to know why it’s happening

The shortage of chips and materials is a global disaster. Even China is concerned, especially after discovering that there is also a problem with rare earths. The list of 17 elements is more important than it seems, especially since they are used frequently in the automotive and technology industry. As they say, we were few and the grandmother gave birth.

skyrocketing prices. Rare earths already have a name that makes it clear that getting these materials is complicated. Demand has been outstripping supply for some time, and even China — a benchmark in this segment — has been affected. The consequences, the expected: production costs through the roof.

Rare, but (highly) desired. Neodymium is used in lasers or electric car motors. Lanthanum, in telescope and camera objectives. Praseodymium, in aircraft engines. Like scandium, also used in aerospace components. And so we find a series of materials that, due to their special properties, have become vital for industries such as technology, transport and the automotive industry, or scientific research. The solution, they say, could lie in space mining.

For the interest I love you andres. These very special materials are especially relevant for the Asian giant because this country is the one with the most rare materials matter —reasonable, especially considering that it is a giant of technological production— and also the one that more reservations you have and mine (70%, according to experts) followed (by far) by Vietnam or Brazil. By the end of 2021 China also created a consortium which brought together the main companies in the sector in this country. The idea, of course, is to consolidate its dominance in this market.

Manufacturers, tell me what happens. The Chinese Ministry of Industry and Information Technology this week convened delegates from the materials industry and manufacturing. No details about the meeting were given, but anonymous sources said Chinese rulers wanted to find out what was going on and get rare earth prices under control.

A strategic weapon for the trade war. This new cold war that we are experiencing and that this time involves the United States and China is killing all kinds of markets. Here the Asian giant, however, has the upper hand. Its market share has been reduced and there are deposits in other countries (such as the aforementioned Vietnam or Brazil, but also Russia and India). In the United States they almost completely lack mines of these rare earths, but they do not yield and they have vetoed to China and its rare mineral companies, which will not be able to work with US defense companies.