China Overplays its Hand With Uranium and Rare Earth Elements
When the voracious Beijing leadership in China hinted that the Asian trade behemoth might use critical mineral exports as leverage against the US in trade negotiations last summer of 2019, they unwittingly provided the perfect impetus to forge stronger ties between the US and our North American neighbors in Canada.
With a rich mineral sector, Canada is already providing about 1/4 of the US uranium supply, critical for nuclear power and national security. Australia, another major mining country, is also partnering in the collaborative effort to “push away from China” and reduce the 80% control of the global supply chain now exerted by China.
Of 35 minerals categorized as “critical” to maintaining the robust US economy and national security, Canada is the reliable and locally available supplier of 13 critical minerals and rare earth elements that are vital for the high-tech, defense, and manufacturing sectors. Canada is the number 1 supplier of potash, indium, aluminum, and tellurium to the US.
Also, our northern neighbors are the second-largest supplier to meet US demands for niobium, tungsten, and magnesium according to Marianne Webb’s January 10th, 2020 report at Mining Weekly.
“Canada’s partnership in the initiative is an early demonstration of our commitment to cooperate with the US under the broader action plan,” a Canadian government statement noted.
President Trump and Canadian Prime Minister Justin Trudeau finalized the joint action plan to secure critical mineral supply chains with more support for industry, and information sharing for research and development, “while bolstering our competitiveness in global markets and creating jobs for Canadians,” according to Canadian Natural Resources Minister Seamus O’Regan.
Welcome Progress in the Reduction of Reliance on Chinese Exports in 2020
At Resource Erectors we’ve been tracking US progress in reducing dependence on critical but tenuous Chinese exports for some time now. Under President Trump, The Defense Production Act put the critical state of the US uranium supply chain in the spotlight. As trade tensions with China increase, new initiatives and R&D continue to focus on building a secure US-based rare earth mineral supply chain, leading to exciting new innovations such as extracting rare earth metals from coal mining waste.
The latest joint initiative between the US, Canada, Australia, and other invited countries is a welcome step toward resolving the critical mineral and rare earth element supply chain problems and for providing a boost in 2020 to the US mining industry, just as the watchdogs at Resource Erectors anticipated last October.
The Energy Resource Governance Initiative
The South China Morning Post is reporting on the fact sheet dubbed the Energy Resource Governance Initiative issued this January 2020 by the US State Department. According to the US assistant secretary of state for energy resources, Frank Fannon, escalating tensions with China make it imperative that the US produces more rare earth minerals while helping other countries to secure a reliable supply.
This is especially crucial as high-tech industries expand and increase critical mineral demands around the globe.
“Demand for critical energy minerals could increase almost 1,000 percent by 2050,”- Energy Resource Governance Initiative fact sheet.
Under the initiative, the US Commerce Department made a series of urgent recommendations to significantly increase US domestic production of critical minerals. Steps toward achieving a secure domestic supply chain could include low-interest loans to mining companies, easing mining restrictions on protected areas, and requiring US defense companies to “buy American”.
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