The escalating conflict between the United States and China over semiconductor chips, in which the U.S. has placed sanctions against American companies selling advanced chip technologies to Chinese companies, is likely yo lead China to halt sales of rare earth minerals to the U.S.. China produced over 90 percent of the world’s rare earth minerals that are used in most modern day technologies including satellites, missiles, weapons systems, solar panels, turbines, electric vehicles, cell phones among other things. The United States sources most of its rare earth imports from China. In July, China imposed export restrictions on two rare earth minerals—gallium and germanium—which are critical for semiconductor manufacturing. The decision was seen as a response to Washington’s controls on China’s access to high-end computer chips. on December 1st, China imposed a ban on different types of graphite. A few days later, it also imposed export permits for gallium and germanium. In late December of this year, China banned the export of technology to extract and separate the critical materials.
China’s dominance on this market is not just in mining these metals but also in refining and processing them. For example, China doesn’t mine much cobalt but it refines 85% of the world’s cobalt. China also controls 100% of the world’s graphite production. This month China banned the export of technology to to extract and separate rare earth elements.
The key rare earth elements at issue are lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, lutetium, scandium, yttrium. China refines 89% of the world’s neodymium and praseodymium, the key metals for EV magnets. Neodymium magnets are primarily used for guided missiles, satellite guided “smart bombs,” and aircrafts, including fighter jets.
The only U.S. rare earths mining and processing facility is the Mountain Pass mine in California’s Mojave Desert. This mine supplies around 15 percent of the world’s production of rare earths minerals.
Jeffrey Newman Esq. represents whistleblowers under the SEC, CFTC and FINCEN whistleblower programs. Whistleblowers providing original information to these agencies through counsel, may receive rewards totaling up to 30 percent of a successful recovery made by the SEC, CFTC OR FINCEN and the names and identification of the whistleblowers are not revealed. These may include whistleblowers who reveal violations of U.S. sanctions. Jeff Newman can be reached at Jeff@Jeffnewmanlaw.com or at 617-823-3217
