The electric vehicles have gone through difficult road conditions, but they are still far from their final destination. In question, the rare earths that go into the manufacture of the electric motor – minerals mainly controlled by China. The question for Western policymakers is whether to relax the rules for operating these items or continue to rely on China, which is rapidly industrializing and also the fastest growing market for electric vehicles. .

The United States mined rare earths from the 1960s to the 1980s at a single mine in California. But that country has failed China because of its cheap labor costs – and the environmental footprint left behind. Rare earths contain 17 minerals that need to be separated, which is a dirty and laborious effort. Beyond China, Australia, Brazil and Canada produce rare earths. Given that the United States wants more electric vehicles on the road, should it pursue rare earth mining?

“We can’t stop mining,” says Luisa Moreno, president of Defense Metals Corp. who explores rare earths, during a conversation with this writer. “Our way of life depends on advanced materials – from the car we drive to the buildings that house us. We need these advanced materials. We need to educate people that mining is no longer irresponsible or Most companies adopt environmental, social and governance standards and work with environmentalists and engineers to ensure that mining is cleaner and safer.

China currently exploits 63% of rare earths: 140,000 tonnes out of the 240,000 tonnes mined worldwide. China exploited 90% of all these minerals. But it still controls 85% of the processing – the effort to separate the 17 minerals from the rare earth rock. Consider that the United States still produces 38,000 tons. But this is sent to China for processing.

At the same time, China consolidated three of its state-owned rare earth companies into a single company: China Minmetals Rare Earth Co., which also uses the minerals for smart phones, televisions and fighter jets. These items had flown under the radar. But China has implicitly threatened to use them as a weapon against the United States in the tariff war launched by the Trump administration.

Dr Moreno says demand for rare earths will more than double by mid-century to 500,000 tonnes – once electric vehicles start rolling out en masse. Even more potent, these same minerals are used in wind turbines, electrolyzers and transmission lines which are also needed to achieve net zero goals.

Prime the pump

Policymakers understand the dilemma: The European Union is phasing out the internal combustion engine by 2040, while the Biden administration wants half of all vehicles sold in the United States to be electric by 2030. If electricity can replace gasoline, it would help countries meet their climate goals.

In the United States, General Motors, Ford Motor Co. and Stellantis support President Biden’s initiative. In Europe, policymakers have approved the allocation of $3.5 billion under the European Battery Innovation Project to move away from fossil fuels, which includes the development of rare earths. Companies vying for funding include Fiat Chrysler, BMW and Tesla, as well as Arkema, Borealis, Enel X, Solvay and Sunlight Systems.

“It is important that the government provide more support for these critical materials,” says Moreno of Defense Metals. “It takes a long time to bring mines into production and demand is fast approaching. The other thing is education – to make the public understand that we need to harness these advanced materials if we want to become greener. It can be done responsibly. When the public supports this move, financial markets will understand the value proposition.

Electric vehicles represent 2% of the global automotive market. The U.S. Energy Information Administration predicts that passenger vehicles, fleets and small trucks that use both electric and gas will grow from 1.31 billion vehicles in 2020 to 2.21 billion by 2050. It estimates that hybrids will account for 34% of cars in developed countries and 28% in emerging economies by 2050.

The tire track

But can the United States wean itself off Chinese rare earths? Efforts by the Biden administration to reduce U.S. dependence on Chinese imports have renewed domestic efforts to produce rare earth minerals — prompting legislation to limit such imports with respect to the defense sector. But such laws will be difficult to pass here, mainly because a more liberal Congress would oppose any national mining expansion.

The International Energy Agency says electric vehicles use six times more minerals than those that run on the internal combustion engine. But he adds that, on a global scale, there is no shortage of rare earth elements. Implicit in his analysis is that mining techniques must become best in class.

At best, it would take many years for the United States to catch up with China. According to the US Geological Survey, China represents the preponderance of world production and 40% of its reserves.

Additionally, China plans to build 6 million electric vehicles by 2023, which would require 30,000 tons of rare earths, according to Research and Markets. What impact will this have on electric vehicles?

“The demand for rare earths will continue, and if we don’t develop these projects, China will probably acquire assets in South America and Africa,” says Dr Moreno. “He not only wants to control production, but also where they export, how much and when. The European Union helps businesses because it helps drive the green technology agenda forward.

The international economy is so intertwined that it would be difficult for China to weaponize rare earths or stockpile them for internal use. But this does not dispense with diversifying suppliers and minimizing political risks. While the United States is unlikely to start mining these minerals, Washington can still create incentives similar to Europe’s Battery Innovation project – to improve environmental performance across all segments of the electric vehicle value chain.

See also:

— The argument against electric vehicles is superficial

— The trucking sector goes electric

— Tesla: recycling batteries is essential

– Car manufacturers introduce map to extend chargers

— EO Charge Target Fleets

— Chinese electric vehicles are trying to outrun the competition

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