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To: LoneClone who wrote (188297)	6/12/2025 11:47:20 AM
From: LoneClone	Read Replies (1) \| Respond to of 192380

Column: Demand destruction can help break China’s rare earths chokehold: Andy Home mining.com Reuters \| June 12, 2025 \| 7:10 am Critical Minerals Markets China USA Rare Earth Beijing’s restrictions on rare earth exports have brutally exposed the West’s dependency on Chinese supplies of these esoteric metals and the permanent magnets they help power. But it’s not as if we haven’t been here before. China did the same in 2010. Western automakers have chosen to ignore the historical precedent and doubled down on a technology that remains almost totally beholden to Beijing’s export whims. Now many of them are in full panic mode, with several already forced to halt production lines, demonstrating the outsize economic impact of niche metals such as dysprosium, which is used in neodymium-iron-boron (NdFeB) magnets. China’s willingness to weaponize its dominance of the metals that power our modern world will accelerate the West’s drive to build out its own supply chains. But part of the solution is to use less rare earth elements. The West can’t control supply, but it can move the demand dial. Those who forget the past… Beijing claimed its imposition of rare earth export quotas in 2010 was solely about clamping down on illegal domestic mines. It just happened to come after a collision between a Chinese trawler and a Japanese coast-guard vessel in disputed waters. If Japan was the target, the entire West felt the pain as prices of rare earths went stratospheric. Dysprosium oxide rose 26-fold in price between 2009 and 2012, according to consultancy Adamas Intelligence. China only backed down after a World Trade Organization panel ruled against it in 2014. Some automakers learnt the lesson. Japan’s Nissan Motor Co launched a new version of its LEAF electric vehicle in 2012 with a motor containing 40% less dysprosium. Renault went further, developing an alternative motor without permanent magnets and therefore rare earths for its ZOE model in the same year. Indeed, Adamas estimates the share of EVs powered by rare-earth-free motors rose from less than 1% of global sales in 2010 to 12% in 2017. That, though, proved the peak. Buckle up Rare earth prices fell and remained stable in the late 2010s. Western automakers largely pivoted back to permanent magnets. Around 97% of all EVs sold every year since 2017 use rare-earth-powered motors, according to Adamas. This not only reflects the exponential growth in the EV market – particularly in China, which for obvious reasons has no rare earths phobia – but also the increasing number of magnets in the average new vehicle, whether pure battery or hybrid. As well as the serious business of actually powering the vehicle, there are multiple magnets in the tiny motors controlling heating, entertainment systems, braking and even reminding the driver to buckle up. This has heightened dependency on a country that not only produces around 95% of the world’s NdFeB magnets but also controls the supply chains of the metals required to make them. Peace talks China may have pulled its rare earth lever too hard this time around, quite possibly due to over-zealous bureaucracy at the Ministry of Commerce, which is responsible for separating out exports for military and civilian applications. Talks between Chinese and US representatives entered their second day on Tuesday in an attempt to find a trade-off between China’s restrictions on rare earths and US restrictions on advanced semiconductors. Tariffs loom large in the background. Assuming some sort of deal can be done and Beijing loosens its grip on rare earth exports, the automotive industry’s dependency isn’t going away. Any wait for Western supply to catch up may be a long one. Although Western governments are pouring money into new projects, building a mine-to-magnet supply chain will take years. Moreover, civilian sectors will be second in line. The US Department of Defense has been the single largest investor in the country’s rare earths sector with the stated goal of being able to support “all US defense requirements by 2027”. In terms of must-have magnets, the speakers on your car radio don’t quite compare with an F-35 fighter, which requires more than 900 pounds of rare earths. Demand destruction Do new vehicles really require all the rare-earth-powered technology currently being deployed in non-critical applications? An even bigger question is whether they require a rare-earth magnet even in the power train. Those companies such as Renault and BMW, which learned the lesson from the past, have developed alternative solutions for their EV motors, reducing the impact of the current supply shock. Plenty of other car companies have been looking to do the same, but in most cases the technology is still far from commercial production. China’s latest rare earths restrictions should be a powerful incentive to accelerate the redesign process. Automakers may find engineered demand destruction works faster than building a new supply chain when it comes to escaping China’s chokehold on rare earth magnets. It’s not as if they haven’t done it before. (The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)