Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
A mining industry consultant says the high processing costs and level of expertise required in bringing rare earth mines into production means most of them will fail.
In an interview with Reuters, Jack Lifton, founder of Technology Metals Research, said of the 244 companies hoping to extract REEs, less than 4% will be profitable:
“The choke point for all the companies is the question of what they can do with the concentrated REM ore once it’s above ground. You can extract the rare earths together, but then you have to separate them…the world’s REM separation capacity is 99 percent Chinese and they have unused capacity,” Lifton said.
“The Chinese overwhelmingly control this and that is the key to the rare earth industry. Without separation capacity, all you have is a loss-making ore concentrate company.”
Mining companies are striving to ramp up rare earth exploration and production after China cut its export quota two years ago on the 17 elements used in everything from manufacturing electric cars to cell phone components to magnets used in guidance missiles.
MINING.com reported Oct. 23rd on a plan by Molycorp., the only rare earth producer in the Western hemisphere, to spend $114 million to accelerate by three months the start-up of its rare earth processing facility at Mountain Pass, California.
The mine has re-opened after closing in 2002 due to low rare earth prices and a series of radioactive wastewater spills.
9 Comments
Doancea
C’mon, if there is a need for it they would build it. It’s not like the Chinese invented the separation process and it is a closely guarded technology. They bought the know-how and equipment from us in the 1990s I guess. If necessary the US govt & others would grant subsidies, subventions as this is an important matter to military & society.
Quarry Equipment
Really? Don’t scare me…
Avitripp
50% of statistics are 50% incorrect
Rlpitts0777
96% of 244 companies = 234 companies, which means 10 companies will make it.
Rare Earth fan----
I own shares in a junior resource company called CIN.V (Canadian International Minerals) – They have ground next door to the world class Wicheeda Deposit in British Columbia-
CIN.V is trading around .10 cents and they have drill results due soon- they have drilled into targets that look similar to the ore producing areas where Wicheeda was successful so I am hoping this years they will come up with the goods……..
FoodProcessorVillain
I attended a meeting of industry representatives the other day and we acknowledged the lack of metallurgical capacity required to smelt REE into metals but most felt positive regarding the possibility to acquire the know-how as apparently the chemistry behind it is fairly simple.
Moreover, the Chinese are relying on polluting processes so I’m pretty sure homegrown tech would manage to be cleaner and more efficient. There is no need for efficiency when you have a monopoly.
Where I think Lifton is right is regarding the few mines that will make it. REEs are a hot air balloon of speculation, Geological Surveys worldwide have (the British and the US ones most notably) have indicated that fears of severe supply shortage were overblown and there is already a push towards substitution for priciers REEs. With those factors, the 244 projects are not needed, many won’t be appealing anymore when the most advanced projects go in production, REEs supply increases and price drop. As REEs are not openly traded most have no idea of the prices and their progression (many more common elements have reportedly decreased). The hear say on rarity is fueling speculation.
Thor
the chemistry is simple, and virtually the same from element to element, which is why seperation is such an issue.
Dakininews
Hmmmm … sounds like Chinese propoganda …. the chemistry is just really tedious and repetitive and tedious and repetitve …… but not rocket science ….. just tedious and repetitve ….. maybe more costly re: effort and sepreration compared to crushing and floating and drying …. nobody knew what to do with nickel either when they figured out what it was in the beginning of the 20th century ….. limited demand then too …..
Harystwn
Many rare earth in Indonesia…, China buy cheap Zircon from Kalimantan Indonesia and get rare earth, am heard that REE associated with Zircon, sorry if am wrong…tks
Hary Setiawan
http://www.mesinemas.blogspot.com