Move will likely weigh on prices and deal a blow to rivals, particularly the US and Australia
Surging rare-earth production in China is presenting a new challenge to budding efforts in the US and elsewhere to undercut the Asian giant’s dominance in a market for exotic materials used in everything from smartphones to fighter jets.
With the US and China locked in trade talks, there were fears China may restrict access to the materials. Instead, it is bulking up, potentially pushing companies elsewhere “into a tight cash situation” just as they seek to invest in new projects, said Ryan Castilloux, MD at critical metals consultancy Adamas Intelligence.
That production is currently sent to China to be processed. By the end of 2020, though, that could change, according to James Litinsky, CEO of JHL Capital Group, the majority owner of MP Materials. What the US wants is “a level playing field”, Litinsky added. “We’re concerned China takes predatory actions with pricing and supply.”
President Donald Trump in July ordered the US defence department to spur production of a range of rare-earth magnets used in military hardware amid concerns China could, at any time, restrict exports of the products. US Geological Survey scientists have also visited projects in Australia in the past year, including Northern Minerals’s Browns Range development.
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