. . . What happens when the batteries run out?
That could very well be the case, as the long-awaited ‘rare earth elements’ shortage is supposedly about to hit US shores any second.
China, according to Bloomberg, has cut back export quotas of so-called rare-earth materials — used in making iPod batteries and fuel cells — by some 72 per cent this year.
As Bloomberg sums up:
Rare earths are a group of chemically similar metallic elements, including lanthanum, cerium, neodymium and europium. They are used in radar, high-powered magnets, mini hard-drives in laptop computers, catalytic converters for vehicles, electric-car batteries and wind turbines. China, which accounts for more than 90 percent of the global production, started cutting output and exports in 2006 as prices fell.
The country’s rumoured hoarding of the metals has been a source of controversy for some time now — with China reducing the amount of rare earths that can be exported for at least the last three years. This is not to the liking of countries like Japan, or the United States. European experts warned of a rare earth shortage back in June.
No surprise then, that Bloomberg today cites the possibility of a new trade-war brewing.
On Tuesday, meanwhile, the US Magnetic Materials Association (USMMA), saw reason enough to issue the following press release calling for immediate government action on the matter:
WASHINGTON–(BUSINESS WIRE)–The United States Magnetic Materials Association (“USMMA”), a trade association representing domestic high performance magnet producers and suppliers, today warned of impending shortages of rare earth materials needed to support domestic manufacturing in support of emerging green technologies like wind generation, hybrid vehicles, and new battery development, high-tech consumer products like mobile phones, PDAs, MP3s, and national security and defense systems.
“This news from China should serve as a huge red flag for U.S. government officials studying this issue” Late last week, China, the world’s largest rare earths producer, announced new plans to cut rare earth export quotas by 72 percent for the second half of the year. According to China’s Ministry of Commerce, foreign shipments will be capped at 7,976 metric tons, down from 28,417 tons for the same period last year.
“This news from China should serve as a huge red flag for U.S. government officials studying this issue,” said USMMA President Ed Richardson, Vice President of USMMA founding partner Thomas & Skinner. “This further validates claims by the USMMA that immediate action must be taken to free the United States from its complete foreign dependence on these increasingly important natural resources. If the United States is to become a leader in clean energy technology, it needs a reliable domestic rare earths supply chain.”
Yes, won’t somebody please think of the iPods clean energy?
Related links:
Goldman really likes its new iPad - FT Alphaville
European experts warn over rare metal shortages – FT