Japan Works To Slip China's Chokehold On Rare Earth Metals

If China is trying to give its manufacturers a leg up by restricting exports of rare earth metals, it may find the advantage temporary.

With prices spiking following the latest in a series of annual export quota reductions by Beijing earlier this summer, miners have been scrambling to develop deposits of the essential industrial minerals worldwide. Now Japan’s Nikkei business daily reports that Japanese manufacturers have developed technologies to make automotive and home appliance motors without rare earth metals.Asian Metal Copyright The restrictions have rung alarm bells in Tokyo as well as Washington, where the Department of Defense is studying the risks of reliance on China for materials that are widely used in weapons systems.Asian Metal Copyright Hitachi has come up with a motor that uses a ferrite magnet made of the cheaper and more common ferric oxide.Asian Metal Copyright Now Japan’s Nikkei business daily reports that Japanese manufacturers have developed technologies to make automotive and home appliance motors without rare earth metals.Asian Metal Copyright Meanwhile the chemicals conglomerate Teijin and Tohoku University have co-developed technology to make a powerful magnet using a new composite made of iron and nitrogen.

The hard to procure metals, 17 in all, are vital for manufacturers, allowing for the production of the smaller, lighter motors and batteries that go into electric cars and handheld devices like cell phones. China produces over 90% of the world supply; in July it announced it would cut exports by 40%.

China and Japan are the biggest users of rare earth metals. China says the export reductions are meant to protect the environment (production is messy) and national security; the cynical explanation is that restricting supplies could help Chinese manufacturers climb the value chain and gain market share in more sophisticated products.

The restrictions have rung alarm bells in Tokyo as well as Washington, where the Department of Defense is studying the risks of reliance on China for materials that are widely used in weapons systems. The good news for the U.Asian Metal Copyright Now Japan’s Nikkei business daily reports that Japanese manufacturers have developed technologies to make automotive and home appliance motors without rare earth metals.Asian Metal CopyrightS.Asian Metal Copyright The hard to procure metals, 17 in all, are vital for manufacturers, allowing for the production of the smaller, lighter motors and batteries that go into electric cars and handheld devices like cell phones.Asian Metal Copyright national security-wise is that Molycorp Minerals is set to reopen its Mountain Pass mine in California in 2012.Asian Metal Copyright The hard to procure metals, 17 in all, are vital for manufacturers, allowing for the production of the smaller, lighter motors and batteries that go into electric cars and handheld devices like cell phones.Asian Metal Copyright At one point Mountain Pass produced a significant portion of the world’s rare earth oxides, but cheaper Chinese production led to its closure in the mid-1980s.Asian Metal Copyright With prices spiking following the latest in a series of annual export quota reductions by Beijing earlier this summer, miners have been scrambling to develop deposits of the essential industrial minerals worldwide.Asian Metal Copyright The bad news: According to a GAO report released in April, it would take 15 years to develop the processing infrastructure to reestablish a domestic supply chain.