Counterbalance China! U.S., Japan, India and Australia to jointly establish rare earth supply chain

Nikkei News 11 reported that the United States, Japan, India and Australia will work together to create a rare earth procurement chain to counteract China’s dominance in this field.

China currently produces nearly 60 percent of the world’s rare earths, and its power in this market raises supply concerns. The Quadrilateral Security Dialogue (Quad), comprised of the U.S., Japan, India and Australia, intends to cooperate in funding new production technologies and development programs to counter China’s market dominance, and Quad intends to take the lead in drafting international rules. Rare earths are an important raw material in the manufacture of a variety of products, from smartphones and high-performance motors to electric vehicle batteries.

The leaders of the four countries will confirm their intention to cooperate at an online summit on the 12th to reduce their dependence on China to produce rare earths. At the summit, U.S. President Joe Biden, Japanese Prime Minister Yoshihide Suga, Indian Prime Minister Narendra Modi, and Australian Prime Minister Morrison will also be concerned about Chinese communist attempts and developments at sea. In addition, this group of four countries is likely to agree to cooperate in supplying the development of a vaccine for the Chinese country’s new crown pneumonia (CCP virus).

Large technology companies rely on Chinese production of rare earths, including neodymium, which is vital for the production of electric vehicles, and lithium, which is used in batteries. These metals are also essential for wind turbines and other “decarbonization” infrastructure.

China has a near monopoly on the separation and purification of rare earths, but these processes have also raised concerns about environmental and soil damage.

China’s market share of rare earths has declined in recent years, with China accounting for 58 percent of global rare earth production last year, down from about 90 percent four years ago, according to the U.S. Geological Survey, as the United States and Australia boosted production.