WEBVTT - China Dominates Rare Earths -- Can It be Copied? 0:00:01.160 --> 0:00:04.520 China has a near monopoly on rare earths, accounting for 0:00:04.559 --> 0:00:07.800 close to sixty percent of global mining and over ninety 0:00:07.840 --> 0:00:12.280 percent of processing. And importantly, China is using its dominant 0:00:12.280 --> 0:00:16.239 position as a bargaining chip in their negotiations with the US. 0:00:16.800 --> 0:00:21.640 When President Trump announced Liberation Day tariffs, China immediately retaliated 0:00:21.760 --> 0:00:25.919 by restricting supply of rare earths, causing companies like Forward 0:00:26.040 --> 0:00:30.120 to halt production. The US has also issued several directives 0:00:30.160 --> 0:00:34.279 around rare earths, including an investigation that could yield more tariffs. 0:00:34.960 --> 0:00:38.400 So what are these minerals, why are they so important 0:00:38.440 --> 0:00:41.559 to global trade and production? And how did China come 0:00:41.560 --> 0:00:42.640 to dominate this space? 0:00:43.880 --> 0:00:46.640 You're listening to Age Eccentric from Bloomberg Intelligence. 0:00:46.960 --> 0:00:50.240 I'm John Lee in Hong Kong, and I'm Katydmitrieva, also 0:00:50.240 --> 0:00:50.800 in Hong Kong. 0:00:51.280 --> 0:00:54.920 Here to discuss everything related to rare earths is Curtis More, 0:00:55.360 --> 0:00:59.520 senior vice president at Energy Fuels, a major uranium miner 0:00:59.560 --> 0:01:03.680 that also produces rare earths. He's dialing in from Denver. Curtis, 0:01:03.720 --> 0:01:04.440 Welcome to the show. 0:01:04.600 --> 0:01:07.759 Hi, it's great to be here. Curtis, give us. 0:01:07.640 --> 0:01:11.720 A one oh one. What exactly are rare earths. 0:01:11.600 --> 0:01:14.479 Yeah, I'm happy to do so. So, rare earths are 0:01:14.560 --> 0:01:17.720 essentially the second to last line on the periodic table. 0:01:18.080 --> 0:01:20.880 It is a series of metallic elements. It starts with 0:01:21.040 --> 0:01:25.280 lanthanum and goes through syrium and praiseodemium and neodymium, also 0:01:25.360 --> 0:01:28.920 including a yettrium and scandium. And they have just a 0:01:28.959 --> 0:01:32.959 wide variety of important uses in a host of clean 0:01:33.040 --> 0:01:38.160 energy technologies, other advanced technologies, military and defense technologies, and 0:01:38.560 --> 0:01:40.160 other applications like that. 0:01:40.840 --> 0:01:44.000 So what are they if you can just describe because 0:01:44.120 --> 0:01:48.840 my understanding is, you know, rare earths are critical minerals, 0:01:49.440 --> 0:01:51.440 but you know, rare earths are a bit of a 0:01:51.440 --> 0:01:55.520 misnomer because they're actually pretty widely available on Earth. It's 0:01:55.600 --> 0:01:59.000 just getting to them and getting to them in large amounts. 0:01:59.040 --> 0:01:59.600 Is that right? 0:02:00.680 --> 0:02:02.920 Yeah, that is correct. There's a lot of i'd say 0:02:02.960 --> 0:02:06.400 confusion between rare earths and critical minerals, and some people 0:02:06.440 --> 0:02:09.360 tend to use those two terms interchangeably. That is not 0:02:09.480 --> 0:02:12.400 totally accurate. One way to think about it is that 0:02:12.840 --> 0:02:15.760 rare earths are critical minerals, but critical minerals are not 0:02:15.800 --> 0:02:18.720 necessarily rare earths, And it's also correct that it's a 0:02:18.720 --> 0:02:21.679 misnomer that rare earths are rare in the Earth's crest. 0:02:21.680 --> 0:02:24.760 They are actually quite common. But finding rare earths and 0:02:24.960 --> 0:02:30.040 economically viable and accessible deposits is somewhat rare. And then 0:02:30.280 --> 0:02:34.320 to actually extract those and process those minerals into usable 0:02:34.560 --> 0:02:38.080 materials and products, that's extremely rare. And that is where 0:02:38.200 --> 0:02:40.880 China absolutely dominates the global market right now. 0:02:41.560 --> 0:02:44.800 And how did China come to dominate this space, because 0:02:45.160 --> 0:02:48.480 from understanding, you know, the US used to mine and 0:02:48.520 --> 0:02:51.120 refine where Earth's maybe say twenty years ago. So tell 0:02:51.200 --> 0:02:53.919 us the roadmap of how China came to be so dominant. 0:02:55.240 --> 0:02:58.960 Well, again, I'm only speculating here, but I give China 0:02:58.960 --> 0:03:01.320 and Chinese companies a lot lot of credit. I think 0:03:01.360 --> 0:03:05.079 that they saw the future about thirty years ago. They 0:03:05.120 --> 0:03:07.680 saw an area where the United States was kind of 0:03:07.680 --> 0:03:10.600 stepping back from global markets, and I think a lot 0:03:10.600 --> 0:03:13.760 of Chinese companies realized that there was an opportunity there, 0:03:13.760 --> 0:03:17.200 a market opportunity based upon where certain technologies were headed 0:03:17.240 --> 0:03:20.080 at that time, and so there was a vacuum that 0:03:20.120 --> 0:03:22.919 got opened up by the United States, and Chinese companies 0:03:23.120 --> 0:03:26.760 smartly stepped in to fill that vacuum. And so over 0:03:26.800 --> 0:03:30.200 the last twenty or thirty plus years, Chinese companies have 0:03:30.720 --> 0:03:33.080 expended a lot of resources and a lot of there's 0:03:33.080 --> 0:03:35.840 been a lot of training, a lot of technology development 0:03:35.960 --> 0:03:39.960 in rare mining and processing, and as a result, Chinese 0:03:40.000 --> 0:03:42.920 companies have really taken a dominant position. I mean, I'll 0:03:42.960 --> 0:03:44.600 tell you the mining of rare this is kind of 0:03:44.600 --> 0:03:46.480 the easy part. You know, digging rocks up out of 0:03:46.520 --> 0:03:48.800 the ground or extracting the minerals out of the ground, 0:03:48.800 --> 0:03:51.240 that's kind of the easy part. But turning those minerals 0:03:51.280 --> 0:03:54.440 into you know, say separated rare earth oxides or rare 0:03:54.480 --> 0:03:57.600 earth metals or alloys or magnets or other advanced materials, 0:03:57.920 --> 0:03:59.800 that's really the hard part. And that takes a lot 0:03:59.800 --> 0:04:02.600 of technical know how and a lot of capital to 0:04:02.600 --> 0:04:05.480 build the facilities that are needed to perform those functions. 0:04:05.720 --> 0:04:08.120 And China has just really made it a priority and 0:04:08.160 --> 0:04:10.400 as a result, they hold a dominant position today. 0:04:10.760 --> 0:04:14.600 Yeah, it really took decades, right, Like you had that 0:04:15.000 --> 0:04:18.560 component in particular, So it's the digging, it's finding it, 0:04:18.640 --> 0:04:21.360 and then it's refining it as well. And they also 0:04:22.040 --> 0:04:24.520 happened to invest or have ownership over some of the 0:04:24.560 --> 0:04:28.400 world's biggest rare earth deposits. So like in Inner Mongolia 0:04:28.520 --> 0:04:31.000 there's the world's largest rare earth deposit, and it's an 0:04:31.000 --> 0:04:33.479 autonomous region of China, and so they've got some control 0:04:33.480 --> 0:04:36.440 over it. Like how much of this is just luck 0:04:36.680 --> 0:04:38.680 and you happen to have it in your own backyard? 0:04:38.800 --> 0:04:41.880 And how much of it is actually investment in government 0:04:41.960 --> 0:04:46.880 sponsorship and going out and finding perhaps friend showing for example. 0:04:46.920 --> 0:04:48.960 And I guess what I'm getting at is can other 0:04:49.000 --> 0:04:51.120 countries like the US replicate this. 0:04:52.720 --> 0:04:54.680 I would not say it was luck. I think it 0:04:54.720 --> 0:04:57.560 was foresight. Honestly. I think they saw this opening in 0:04:57.640 --> 0:04:59.560 the global markets, and they saw where a lot of 0:04:59.560 --> 0:05:02.480 advanced technologies were going, and so they made a concerted 0:05:02.480 --> 0:05:05.480 effort to go secure the resources to build out the 0:05:05.800 --> 0:05:09.000 refining and processing capacity, to make the investments that are 0:05:09.040 --> 0:05:13.320 necessary to create that capacity. Education, you know, in training 0:05:13.720 --> 0:05:18.200 and workforce, you know, investments just across the spectrum. You know, again, 0:05:18.360 --> 0:05:20.640 rares are not that rare. You know, sure there's better 0:05:20.640 --> 0:05:23.919 deposits in certain areas, and yes, if you're blessed with 0:05:23.960 --> 0:05:26.320 a good deposit in your nation, that's I guess maybe 0:05:26.320 --> 0:05:28.600 that's a small amount of luck, but it takes more 0:05:28.600 --> 0:05:31.160 than luck to achieve a dominant position in this industry. 0:05:31.440 --> 0:05:33.560 I mean, I would say that other countries like the 0:05:33.640 --> 0:05:36.600 United States and in Europe, Japan, South Korea, I think 0:05:36.640 --> 0:05:39.320 there is a roadmap there for those countries to follow, 0:05:39.320 --> 0:05:41.640 but it's also not going to happen overnight. There's been 0:05:41.640 --> 0:05:43.839 a great deal of investment. This has been a multi 0:05:43.920 --> 0:05:47.000 decade effort by China and Chinese companies, and I don't 0:05:47.040 --> 0:05:49.479 think other countries are probably going to solve that or 0:05:49.520 --> 0:05:51.239 achieve that level of success overnight. 0:05:51.880 --> 0:05:54.960 So how many years are we talking about codis, you know? 0:05:55.040 --> 0:05:57.520 I mean, I've often heard it said that the United 0:05:57.560 --> 0:06:00.479 States kind of globalized a lot of our supply chains 0:06:00.480 --> 0:06:02.799 over twenty or thirty years, and it may take twenty 0:06:02.800 --> 0:06:06.360 thirty years to completely deglobalize it on things like critical minerals. Now, 0:06:06.920 --> 0:06:09.279 I'm not sure I totally buy into that timeframe, but 0:06:09.680 --> 0:06:12.400 it is a matter of years. And there's been a 0:06:12.480 --> 0:06:16.320 number of challenges that Western rare earth companies have encountered. 0:06:16.560 --> 0:06:19.000 There have been efforts to try to rebuild these supply 0:06:19.120 --> 0:06:22.560 chains over the last several years that generally have not 0:06:22.600 --> 0:06:25.960 been particularly successful. Now we are seeing I think the 0:06:26.080 --> 0:06:29.320 level of support from the US government that is likely required. 0:06:29.720 --> 0:06:32.120 There was the deal done with MP Materials a couple 0:06:32.160 --> 0:06:34.400 of weeks ago. That's kind of the level of support 0:06:34.400 --> 0:06:36.240 that it's going to take to try to catch up. 0:06:36.440 --> 0:06:38.680 I mean, one of the big advantages that Chinese companies 0:06:38.720 --> 0:06:41.839 have over US companies is that they already have their infrastructure. 0:06:41.839 --> 0:06:45.279 They already have their refining and processing facilities and manufacturing 0:06:45.560 --> 0:06:49.279 facilities already built. They've already got the vertical integration figured out, 0:06:49.480 --> 0:06:51.560 and really that's just a way to lower costs and 0:06:51.640 --> 0:06:54.240 to become more efficient, and so to be able to 0:06:54.320 --> 0:06:56.360 replicate that in the West is it's going to take 0:06:56.360 --> 0:06:58.239 a little bit of time and quite a bit of investment. 0:06:58.279 --> 0:07:00.600 Now there are some again, some bright spot there, I 0:07:00.640 --> 0:07:03.920 mean MP Materials, they're on a great path. I think 0:07:04.240 --> 0:07:06.359 energy fuels were on a good path. But it's going 0:07:06.440 --> 0:07:07.920 to take a long time to be able to match 0:07:07.960 --> 0:07:10.520 what China has put together, just in. 0:07:10.520 --> 0:07:13.320 Terms of the infrastructure. I mean, we've seen the Trump 0:07:13.320 --> 0:07:17.320 administration take a number of steps the Section two thirty 0:07:17.360 --> 0:07:21.600 two investigation that might add more tariffs on critical minerals 0:07:21.680 --> 0:07:25.560 or rare earths. We've also seen this push starting in 0:07:25.600 --> 0:07:29.440 March of this year to agencies to seek the development 0:07:29.720 --> 0:07:33.040 of this in the US. What else does the US 0:07:33.160 --> 0:07:36.640 government kind of need to do to start this process 0:07:36.720 --> 0:07:39.240 of you know, what's the roadmap? What do they need 0:07:39.280 --> 0:07:41.400 to do for companies like you and other peers to 0:07:41.480 --> 0:07:43.920 sort of start developing this within the US. 0:07:44.880 --> 0:07:47.320 Well, I mean, again, I think the MP Materials deal 0:07:47.360 --> 0:07:49.040 that was announced a couple of weeks ago is a 0:07:49.040 --> 0:07:52.160 pretty good roadmap. Some of the aspects of that deal 0:07:52.280 --> 0:07:56.920 were things like price floors to essentially guarantee that companies, 0:07:57.040 --> 0:08:00.240 especially in their early stage, are able to preduce use 0:08:00.440 --> 0:08:03.560 these advanced rare earth materials. And again, this isn't just 0:08:03.600 --> 0:08:05.360 apply to rare it's I think this applies to all 0:08:05.360 --> 0:08:07.640 critical minerals things, you know, other things like you know, 0:08:07.680 --> 0:08:10.840 antimony and germanium and gallium and the whole spectrum there. 0:08:12.160 --> 0:08:15.280 That's one of the challenges that Western companies have in 0:08:15.320 --> 0:08:18.320 trying to compete with much more mature industries like they 0:08:18.360 --> 0:08:20.920 have in China. You know, typically when you're just starting 0:08:20.920 --> 0:08:23.080 out in an industry like this, your costs are just 0:08:23.120 --> 0:08:26.040 simply higher. You haven't achieved those efficiencies and that those 0:08:26.040 --> 0:08:28.520 competencies that are required, so you know some of the 0:08:28.520 --> 0:08:30.680 price floors. I think that's a good way to approach it. 0:08:31.520 --> 0:08:34.800 You know, low interest loans, grants, you know, government funding 0:08:34.840 --> 0:08:38.240 to build out facilities, you know, government funding to help 0:08:38.280 --> 0:08:41.280 train workforce and to build up an industry. And it'll 0:08:41.280 --> 0:08:43.320 probably take you know, at least five or ten years 0:08:43.360 --> 0:08:45.520 to build up a mature industry that can compete with 0:08:45.640 --> 0:08:48.679 Chinese companies. I will say that those types of investments 0:08:48.679 --> 0:08:50.960 and those types of efforts in the West I think 0:08:51.000 --> 0:08:53.520 have not really occurred in the past. But it sounds 0:08:53.520 --> 0:08:56.240 like Western governments are waking up to what is the 0:08:56.240 --> 0:08:57.960 magnitude of what is really required here. 0:08:58.720 --> 0:09:02.040 Asia Centric is produced by Bloomberg Intelligence. We're more than 0:09:02.080 --> 0:09:05.920 five hundred experienced analysts and strategists work around the clock 0:09:05.960 --> 0:09:09.480 to bring you timely, world class research. Our coverage spans 0:09:09.520 --> 0:09:13.800 two hundred market industries, currencies, commodities and industries, as well 0:09:13.840 --> 0:09:16.880 as over two thousand equities and credits. To learn more 0:09:16.880 --> 0:09:21.079 about Bloomberg Intelligence, visit bi go on the Bloomberg terminal. 0:09:21.640 --> 0:09:24.160 If you like what you're hear, don't forget to subscribe 0:09:24.160 --> 0:09:28.080 and share. Curtis just for the benefit of the listener. 0:09:28.360 --> 0:09:32.520 The US Department of Defense invested in MP Materials. I 0:09:32.559 --> 0:09:35.600 think the figure was like four hundred million dollars, and 0:09:35.640 --> 0:09:37.959 this is the deal that we're referring to. It became 0:09:38.000 --> 0:09:41.040 the largest sharehold of MP Materials, and let's be frank, 0:09:41.080 --> 0:09:43.960 it had an amazing impact on the share price of 0:09:44.040 --> 0:09:46.480 this company. I think it almost tripled, and your company 0:09:46.480 --> 0:09:49.600 as well. Your stock price really ramped up as well. 0:09:50.080 --> 0:09:52.240 Is this what it takes? Like, does it really need 0:09:52.360 --> 0:09:56.720 the government support to build up the US rare eers infrastructure? 0:09:57.720 --> 0:10:00.599 You know, I'm not sure it takes actual government ownership. 0:10:01.800 --> 0:10:03.559 I mean, I think it was just more the injection 0:10:03.640 --> 0:10:06.360 of capital into MP Materials. And I think maybe the 0:10:06.480 --> 0:10:08.880 US government or the DoD was, you know, looking to 0:10:08.880 --> 0:10:11.920 maybe get a return on taxpayer money. If you're going 0:10:11.960 --> 0:10:14.240 to invest, you know, hundreds of millions or billions of 0:10:14.240 --> 0:10:17.080 dollars into a company rather than just give a private 0:10:17.120 --> 0:10:19.480 company money, well let's see if the taxpayer can get 0:10:19.520 --> 0:10:21.319 a return on it. I mean, again, I can't get 0:10:21.360 --> 0:10:24.079 into their heads. I don't know what their thought was there, 0:10:24.360 --> 0:10:26.320 but that seems to make sense to me. I have 0:10:26.400 --> 0:10:29.679 my concerns about government ownership or becoming a major shareholder 0:10:29.720 --> 0:10:32.640 in a company. I'd prefer that to not be the case. 0:10:32.679 --> 0:10:34.520 But again, you know, if that's the way to get 0:10:34.520 --> 0:10:36.880 the funding that the government has available, you know we 0:10:36.920 --> 0:10:38.560 as a company would certainly be open to it. 0:10:39.520 --> 0:10:43.720 So MP Materials has the only active rare earth mind 0:10:44.120 --> 0:10:47.320 in the US. It's really tough to build, as you said, 0:10:47.320 --> 0:10:49.600 build out the infrastructure in the US for this. At 0:10:49.600 --> 0:10:53.960 the same time, this directive from Trump in March, this 0:10:54.080 --> 0:10:58.040 executive order to produce more domestically, I mean, is it 0:10:58.120 --> 0:11:00.640 possible to have more minds this of MP. 0:11:02.000 --> 0:11:06.000 Well, first you need deposits, right, I will say, and 0:11:06.040 --> 0:11:10.040 this may be somewhat controversial statement, but the US has 0:11:10.880 --> 0:11:14.640 okay rare earth deposits, but not not exceptional rare earth deposits. 0:11:15.120 --> 0:11:18.240 And there's a variety of efforts to try to build 0:11:18.240 --> 0:11:21.240 out these minds in the United States. But the truth 0:11:21.320 --> 0:11:23.240 is is that I think we can take a page 0:11:23.240 --> 0:11:25.320 out of China's book, and you know, you don't have 0:11:25.400 --> 0:11:28.560 to produce everything in country. It's okay if you're importing 0:11:28.600 --> 0:11:32.480 minerals or raw materials from other countries, just like China does. Right, 0:11:32.800 --> 0:11:36.480 And you're right, MP Materials has I'd say kind of 0:11:36.520 --> 0:11:39.600 the main rare earth mind in the United States. You know, 0:11:39.679 --> 0:11:43.600 our company, we're actually receiving rare earth ores from Florida 0:11:43.640 --> 0:11:47.600 and Georgia. In the United States, we're actually approaching rare 0:11:47.640 --> 0:11:51.480 earth production from a quite different standpoint. We're looking to 0:11:51.520 --> 0:11:56.120 actually obtain rare earth minerals from other minds that these 0:11:56.120 --> 0:11:58.440 are rare earth minerals that are produced as a byproduct 0:11:58.520 --> 0:12:01.880 of other mining, primarily type tenium mines actually, which is 0:12:02.320 --> 0:12:04.440 a different way to look at it. And actually, you know, 0:12:04.520 --> 0:12:07.360 China does this. Chinese companies do this. We estimate that 0:12:07.400 --> 0:12:10.960 probably ten or fifteen percent of China's rare earth industry 0:12:11.280 --> 0:12:13.840 is supported in the same manner that we're going about this, 0:12:13.920 --> 0:12:17.559 where we're getting these monozite and xenotime minerals from heavy 0:12:17.600 --> 0:12:20.040 mineral sand operations. I mean, that's kind of one of 0:12:20.040 --> 0:12:22.040 the dirty little secrets I guess I could say about 0:12:22.120 --> 0:12:25.280 rare earths is that not only are they not rare, 0:12:25.360 --> 0:12:28.120 but they're actually already mined all over the world as 0:12:28.160 --> 0:12:32.040 a byproduct of other mining. And honestly, rare earth minds 0:12:32.040 --> 0:12:34.680 that are just single commodity rare earth mines where all 0:12:34.720 --> 0:12:36.439 they do is rare earth honestly at a bit of 0:12:36.480 --> 0:12:40.160 a competitive disadvantage versus other minds that maybe produce a 0:12:40.200 --> 0:12:42.120 number of commodities from the same deposit. 0:12:43.160 --> 0:12:46.719 And you're getting these U said, from Florida and Georgia. 0:12:46.800 --> 0:12:50.160 Yep. Yeah, So these are essentially titanium and zircon mines 0:12:50.240 --> 0:12:52.920 is what they are. Now. Most titanium and zircon, i'd say, 0:12:52.960 --> 0:12:54.959 are kind of boring industrial materials. I mean, I don't 0:12:54.960 --> 0:12:57.640 want to minimize them. And of course there are high 0:12:57.640 --> 0:13:00.839 tech and very critical uses for titanium and zircon and 0:13:00.920 --> 0:13:03.880 zirconium and things. But you know, most titanium goes into 0:13:03.920 --> 0:13:06.760 paint and pigment and you know, mix your your paper 0:13:06.800 --> 0:13:10.240 white and things like that. Most zircon goes into just 0:13:10.440 --> 0:13:12.960 you know, ceramics, you know, like tile in your kitchen 0:13:13.000 --> 0:13:15.000 and things like that. And there's a, you know, a 0:13:15.080 --> 0:13:18.040 robust global market for titanium and zircon and those types 0:13:18.080 --> 0:13:21.679 of minerals. But right alongside those titanium and zircon minerals 0:13:21.720 --> 0:13:24.720 are other minerals that are full of rare earths, primarily 0:13:24.760 --> 0:13:28.520 monozite and xenotyme, and those are some wonderful rare earth 0:13:28.559 --> 0:13:33.000 minerals because they have really good concentrations of the light, 0:13:33.120 --> 0:13:36.360 the middle and the heavy rare earths. And you hear 0:13:36.400 --> 0:13:38.520 a lot about those categories in the rare earth industry. 0:13:38.679 --> 0:13:40.640 And that might be another rare earth one on one 0:13:40.960 --> 0:13:44.400 lesson here, But whenever you hear about light rare earths, 0:13:44.640 --> 0:13:49.479 people are primarily talking about neodymium and praiseodemium or ndpr. 0:13:49.880 --> 0:13:52.480 Those are the light rare earths that are used in magnets, 0:13:52.720 --> 0:13:56.880 and these magnets are used primarily in electric vehicles, in 0:13:56.960 --> 0:14:02.800 hybrid electric vehicles, advanced robotics, certain wind energy technologies. Of course, 0:14:02.840 --> 0:14:06.280 military and defense. You'll also hear about heavy rare earths. 0:14:06.559 --> 0:14:10.920 There's two main magnet heavy rare earths, that's urbium and dysprosium. 0:14:11.160 --> 0:14:14.040 That's TB and d Y and again you create these 0:14:14.120 --> 0:14:17.880 very powerful magnets, neodymium magnets. They are used in those applications. 0:14:18.400 --> 0:14:21.040 There are other heavy rare earths, you know, things like 0:14:21.320 --> 0:14:25.320 lutetium and yetrium and others that have important military and 0:14:25.360 --> 0:14:28.560 defense technologies, and those are the ones that are on 0:14:28.600 --> 0:14:31.520 the export control list that the Chinese government put in place. 0:14:31.760 --> 0:14:35.720 That's urbium and dysprosium and yttrium, samarium, gadolinium. Those are 0:14:35.760 --> 0:14:39.040 kind of the middle rares, sometimes categorized as heavies, but yeah, 0:14:39.080 --> 0:14:43.360 the main uses are magnets and some other applications and Curtis. 0:14:43.400 --> 0:14:46.600 When China restricted some of the supply of the rare earths, 0:14:46.600 --> 0:14:51.080 we saw companies hope production and it was notable that 0:14:51.160 --> 0:14:53.600 Ford had to cut back production in one of their plants. 0:14:54.160 --> 0:14:58.520 How much supply does the US have right now and 0:14:58.960 --> 0:15:01.400 how quickly will it run out if China were to say, 0:15:01.480 --> 0:15:02.520 you know, tun off the taps. 0:15:02.960 --> 0:15:06.360 You know that. I don't know. I know it's not infinite. 0:15:06.560 --> 0:15:08.800 As an American, I know I hope that the US 0:15:08.840 --> 0:15:12.600 military has enough. I presume they have enough foresight to 0:15:12.640 --> 0:15:15.480 have stockpiles to get them through. But in terms of 0:15:15.520 --> 0:15:18.200 like a Ford or a General Motors, or even a 0:15:18.280 --> 0:15:21.560 Kia or Hyundai or Mercedes, yeah, I don't know. But again, 0:15:21.720 --> 0:15:23.840 the fact that Ford had to shut down a plant, 0:15:23.880 --> 0:15:26.920 that's very telling. I do know that there is a 0:15:26.960 --> 0:15:29.680 lot of effort out there by these companies to try 0:15:29.720 --> 0:15:32.840 to procure rare earth materials that don't come from China, 0:15:33.440 --> 0:15:35.560 And honestly, the sources are very limited. I mean you 0:15:35.640 --> 0:15:39.520 have you know, MP Materials, which is producing DPR oxide 0:15:39.840 --> 0:15:43.000 that's the light magnet rare earth oxide. And I think 0:15:43.000 --> 0:15:45.480 they're up to two thousand or twenty five hundred metric 0:15:45.520 --> 0:15:48.600 tons of NDPR oxide per year. And just for context, 0:15:48.960 --> 0:15:52.800 a typical electric vehicle needs an additional say half a 0:15:52.880 --> 0:15:56.720 kilogram to kilogram of NDPR oxide per vehicle, you know, 0:15:56.760 --> 0:16:00.200 so if you're producing say two thousand tons of dpr ocid, 0:16:00.280 --> 0:16:02.400 that's enough for say two to four million evs per 0:16:02.440 --> 0:16:05.040 year or hybrid evs per year, just kind of for context. 0:16:05.560 --> 0:16:09.160 And so Linus is a company out of Australia that 0:16:09.280 --> 0:16:12.320 is the largest non Chinese producer of rare earth oxides 0:16:12.360 --> 0:16:15.440 in the world. They mine in Western Australia. They do 0:16:15.560 --> 0:16:18.200 some early processing also in Western Australian. I think they 0:16:18.200 --> 0:16:21.880 do the separations in Malaysia where they also produce NDPR oxide. 0:16:21.920 --> 0:16:24.720 I saw that they recently started production of d y 0:16:24.760 --> 0:16:28.120 oxide or disprosium oxide, which was a big achievement for them. 0:16:28.560 --> 0:16:31.320 We're going to be producing a pilot scale d Y 0:16:31.440 --> 0:16:33.920 oxide here in the next few weeks. That's a big deal. 0:16:33.920 --> 0:16:37.120 It's a big accomplishment because China really has dominance in 0:16:37.160 --> 0:16:40.040 the heavy rare earth market, which is what disprosium oxide is. 0:16:40.040 --> 0:16:42.440 It's one of the heavies. But besides that, you get 0:16:42.440 --> 0:16:45.160 down to processing. You know, you have you know, companies 0:16:45.240 --> 0:16:48.440 like Neo Performance Materials. They're a Canadian company that has 0:16:48.480 --> 0:16:52.760 a processing plant in Estonia, and some other plants in Thailand, 0:16:52.800 --> 0:16:57.000 I believe, and ownership and some Chinese plants. There's Japanese 0:16:57.040 --> 0:16:59.720 and Korean companies that do a rare earth metallization and 0:16:59.720 --> 0:17:02.760 aling and magnet making for their customers. But it's still 0:17:02.920 --> 0:17:05.040 a bit of a nation industry at this stage. When 0:17:05.080 --> 0:17:07.480 you get down to the especially the oxides and the 0:17:07.560 --> 0:17:09.840 rare earth metals and alloys and magnets and that sort 0:17:09.840 --> 0:17:12.120 of thing. Again, that's really where China has the dominance. 0:17:12.320 --> 0:17:14.360 Yeah, Curtis, you make several good points. I mean you're 0:17:14.400 --> 0:17:18.840 really underscoring some of the issues here, right because critical 0:17:18.880 --> 0:17:22.199 minerals rare earth's quite dispersed. I mean, yes, China has 0:17:22.200 --> 0:17:26.320 the monopoly, but you know there's Canada, there's Greenland, Australia, 0:17:27.440 --> 0:17:30.360 other places that are producing this stuff refining it. Southeast 0:17:30.359 --> 0:17:33.280 Asian countries that are also there's mines there the DRC 0:17:33.520 --> 0:17:38.760 of course with mines. Now, by twenty thirty, the US 0:17:38.840 --> 0:17:42.640 is projected to hold less than two percent of global 0:17:42.680 --> 0:17:46.199 critical minerals, and that compares to thirty one percent for China. 0:17:46.880 --> 0:17:49.640 So it's not clear that the US at this point 0:17:49.640 --> 0:17:53.320 can really ramp up their own production of this stuff. 0:17:53.680 --> 0:17:58.040 So how important is it that the US really tries 0:17:58.119 --> 0:18:01.520 to as opposed to maybe like ramping up production at home, 0:18:01.640 --> 0:18:05.720 also does things like friend shoring or forming those kinds 0:18:05.760 --> 0:18:08.080 of trade deals to try to get the rare earths 0:18:08.080 --> 0:18:12.520 from friendly countries, because that seems like important, but it's 0:18:12.760 --> 0:18:14.880 kind of the opposite is being done now with tariffs. 0:18:16.320 --> 0:18:19.119 Yeah, no, I one hundred percent agree with you. Look, 0:18:19.200 --> 0:18:21.040 you know, the United States is blessed with a lot 0:18:21.040 --> 0:18:23.359 of minerals, but we don't have the best deposits of 0:18:23.400 --> 0:18:26.359 every critical mineral in the world. And frankly, some of 0:18:26.400 --> 0:18:29.679 the efforts to say produce like rare earth's out of 0:18:29.720 --> 0:18:32.880 say like coal waste or something I think is frankly stupid. 0:18:33.840 --> 0:18:34.920 Wait why is it stupid? 0:18:35.040 --> 0:18:39.399 It would be insanely expensive. You know, So you run coal, 0:18:39.600 --> 0:18:41.119 you know, you know, you burn coal on a plant, 0:18:41.160 --> 0:18:43.960 and yeah, you have coal ash and coal waste, and yeah, 0:18:44.000 --> 0:18:46.880 sure there's rare earths in it, but it's wildly expensive 0:18:46.920 --> 0:18:49.920 to try to extract those trace concentrations of rare earths 0:18:49.960 --> 0:18:52.240 out of things like coal waste. I think again, you know, 0:18:52.359 --> 0:18:54.439 rares aren't rare, but to be able to find a 0:18:54.480 --> 0:18:58.600 deposit that's that's even remotely competitive globally. That's what's hard. 0:18:58.600 --> 0:19:00.560 I mean, look, if you have unlimited money, sure you 0:19:00.560 --> 0:19:03.399 can produce rares out of probably seawater, but that doesn't 0:19:03.400 --> 0:19:05.520 make any sense. And again, at the end of the 0:19:05.600 --> 0:19:08.800 day as well, these end users, whether you're a Ford 0:19:08.880 --> 0:19:11.960 or a GM or a Mercedes or a Hyundai or whoever, 0:19:12.280 --> 0:19:14.000 I think they're willing to maybe pay a little bit 0:19:14.040 --> 0:19:16.560 more for non Chinese wearers, but you know they can't 0:19:16.600 --> 0:19:19.680 pay three, four, five, ten times more for their wearers 0:19:19.920 --> 0:19:21.800 than they could otherwise get from China. I mean, they 0:19:21.840 --> 0:19:24.320 have their own competitive pressure points, right. You know, they 0:19:24.320 --> 0:19:27.320 can't start paying more for all these components in their vehicles, 0:19:27.359 --> 0:19:30.720 they will rapidly become uneconomic. So again, I think it's 0:19:30.800 --> 0:19:34.000 very important for the United States to mine our good deposits. 0:19:34.240 --> 0:19:37.400 We do have good deposits of rares in certain critical minerals. 0:19:37.640 --> 0:19:39.280 But we also have to recognize that we don't have 0:19:39.359 --> 0:19:41.640 everything here, and yes, we do need to do more 0:19:41.680 --> 0:19:45.080 friend shoring and mining and processing, you know, with our allies, 0:19:45.119 --> 0:19:47.040 not using our allies, but partnering with our allies. 0:19:47.640 --> 0:19:50.159 And you know, President Trump has been really focused on 0:19:50.200 --> 0:19:52.720 where It may be a reason why he's shown so 0:19:52.800 --> 0:19:55.480 much interest in Greenland because he doesn't have enough of 0:19:55.760 --> 0:19:58.040 reserves in rares. 0:19:59.160 --> 0:20:01.919 Well, look, earths are not rare. I'm sure Greenland has 0:20:02.000 --> 0:20:04.280 rare earths, but I don't think Greenland is going to 0:20:04.280 --> 0:20:06.760 be producing rare earths anytime soon. Now, maybe in twenty 0:20:06.800 --> 0:20:09.560 thirty forty years. That could be you know, a place 0:20:09.800 --> 0:20:11.600 that's a source of a good source of rares. But 0:20:11.640 --> 0:20:15.600 there's better, i'd say, more accessible deposits. You know, Greenland 0:20:15.600 --> 0:20:18.080 has very little infrastructure. It'd be pretty expensive to produce 0:20:18.160 --> 0:20:19.280 rares up there right right now. 0:20:19.320 --> 0:20:23.000 Anyway, you mentioned the infrastructure, the high costs, and one 0:20:23.040 --> 0:20:25.200 other thing that we haven't really talked about is the 0:20:25.320 --> 0:20:29.680 environmental impact and the quality of jobs. It just strikes 0:20:29.720 --> 0:20:32.640 me that you know, there's been a shift in manufacturing, 0:20:32.640 --> 0:20:35.199 for example, to hire higher skilled manufacturing. A lot of 0:20:35.200 --> 0:20:38.720 it has become less dirty, more clean, But mining, especially 0:20:38.760 --> 0:20:41.879 mining of rare earths and critical minerals, is not one 0:20:41.920 --> 0:20:43.600 of those. I mean, the reality is you have to 0:20:43.640 --> 0:20:46.320 dig for them. I wonder if it makes sense for 0:20:46.400 --> 0:20:50.800 the US to prioritize opening more of these kinds of 0:20:50.880 --> 0:20:54.439 minds and creating these kinds of jobs, you know, is 0:20:54.480 --> 0:20:55.840