Group of four countries to create a rare earth supply chain strategy to get rid of the Chinese Communist monopoly

Rare earths refer to 17 different non-ferrous metals that are indispensable elemental materials for key technologies such as smartphones, electric cars, and sensors and communication systems in military weapons. Pictured is the Steenkampskraal (SKK) rare earth deposit in the Western Cape province of Africa. (RODGER BOSCH/AFP via Getty Images)

Rare earths in this context refer to 17 different non-ferrous metals that are indispensable elemental materials for key technologies such as smartphones, electric cars, and sensors and communication systems in military weapons.

The four-nation alliance is seeking to establish a coordinated working group related to critical and emerging technologies to ensure supply chain security in an interdependent global economy.

“Leaders of the four countries recognize that a free, open, inclusive and resilient Indo-Pacific region will require these countries with shared interests and values to collectively master and manage those critical and emerging technologies.” The White House said in a March 12 summit briefing.

Reliance on Communist China’s rare earth supply chain is risky

Rare metal materials take center stage in the U.S.-China trade war, with mainland China producing more than 80 percent of the world’s rare metal raw materials. on Sept. 30, 2020, then-President Trump (Trump) declared that U.S. dependence on rare earths from the Communist Party of China was a national emergency.

The U.S. Department of Energy released a white paper last year on the situation of the rare earth supply chain, defining rare earths or critical minerals as “non-fuel minerals that are critical to the U.S. economy and national security and whose supply chains are highly vulnerable and susceptible to disruption.

The Department of Energy said reliance on imported rare earths puts the supply chain, U.S. companies and users of the material at risk.

“For example, 60 percent of the world’s cobalt ore is mined in the Democratic Republic of Congo, while 80 percent of the cobalt metal supply material is processed and produced in mainland China. U.S. dependence on foreign-sourced rare earths, a critical material, creates strategic vulnerabilities in our economic sector and military technology because any adverse action by the Chinese Communist government, natural disasters and other possibilities could disrupt the supply of these critical raw materials.” The white paper said.

Mr. Satoru Nagao, a non-resident fellow at the Washington-based Hudson Institute, told The Epoch Times that to secure the rare earth supply chain, the Quadrilateral Alliance countries should exchange information on the mining of these rare earth minerals, work together to mine them, and “join with other like-minded countries, including U.S. allies in the Indo-Pacific region and Europe The Quadripartite Alliance countries should exchange information on the mining of these rare earth minerals, work together, and “work with other like-minded countries, including U.S. Indo-Pacific and European allies, to build an Indo-Pacific rare earth supply chain using mining platforms.

According to Thomas Duesterberg, a senior fellow at the Hudson Institute, China’s control of rare earths production also affects geopolitics. For example, the Chinese Communist Party has pushed for the formation of the Regional Economic Partnership (RCEP), a regional trade framework that excludes Taiwan, whose electronics manufacturers rely heavily on rare earths from China.

In a Feb. 17 analysis, Mr. Duesterberg wrote that the CCP’s exclusion of Taiwan from the RCEP is intended to shift production and trade of advanced electronics away from the island nation, thereby creating more economic and political difficulties for Taiwan.

Communist China’s monopoly

Ian Hall, deputy director of the Griffith Institute of Asian Studies in Brisbane, told The Epoch Times in an email, “The issue of rare earths is a looming one, with the U.S. and Japan needing them and Australia having large deposits of them. Given the threatening signals that the Chinese Communist Party has released in the past, it is a prudent and safe strategy to invest in the mining and processing of rare earths to separate the rare earth supply chain from China.”

Mainland China holds only one-third of the world’s rare metals deposits, but controls more than 80 percent of the global market, surpassing the United States, which dominated the market decades ago.

“Since the 1990s, the Chinese Communist Party has dominated rare metals production, driven by two main factors: low prices and state-sponsored investment in infrastructure and technology.” Kristin Vekasi of the University of Maine said in an interview at the 2019 Pacific Energy Summit.

“After mainland China established an absolute advantage in the scale of rare earth production, it [the CCP] used the price advantage generated by scale to attract foreign buyers. Cheaper prices within China, and a multitude of expertise, served to attract foreign investment.” She said this CCP policy has worked, and some Japanese companies have moved production to China.

Mr. Nagao said, “In 2012, Japan reached an agreement with India to import three rare earth ores, including neodymium, cerium and lanthanum. But these are only 10 percent of what Japan needs.”

Japan now relies on mainland China for 60 percent of its rare earths, while U.S. ores are exported to mainland China for separation, processing and refining.

These rare earth ores are not scarce, but they are hard to find, and the mining of rare earths requires mining large amounts of ore, which then needs to be processed. According to Air Force Magazine, the mined elemental material also needs to undergo “technical processing and treatment, a process that is very harmful to the natural environment,” before useful non-ferrous and rare metals can be obtained.

Rare-earth mineral reserves vary from country to country in the Quadruple Alliance. According to German data company Statista, of the world’s total rare earth reserves of 1.2 million tons in 2020, mainland China has 440,000 tons, India has 69,000 tons, Australia has 41,000 tons and the United States has 15,000 tons. Vietnam, which is part of the Quad plus (Quad expansion alliance), has a sizable reserve of 220,000 tons.

Quad Plus developed many new member countries during the plague pandemic, they are New Zealand, South Korea and Vietnam. This is known as the Quad Plus Alliance (Quad plus).

The alliance’s focus and cooperation on key non-ferrous metals and technologies was an embarrassment to the Chinese Communist Party. When asked about the Quad summit, CCP Foreign Ministry spokesman Zhao Lijian said at a March 12 press conference that exchanges and cooperation between countries (referring to the Quad alliance) should not harm the interests of third parties (i.e., the CCP).

Chen Zhanheng, vice president of the Chinese mainland’s rare earth industry association, told the Communist Party’s state-run Global Times, “In the past few years, the CCP has invested a lot of money in improving rare earth refining technology and has developed a certain advantage in this regard. The West currently lacks the relevant talent pool and efficiency to compete with the CCP, and would face much higher costs if it were to refine them itself instead of importing them from mainland China.”

Rare earth strategy

Mr. Nagao said the focus of the four-nation summit is on moving key technology supply chains (i.e., rare earths) outside of CCP control, which is important to the strategic security of these alliance countries.

For example, neodymium, the non-ferrous metal with the strongest magnetic properties, is critical to making missile guidance systems. Lanthanum improves the quality of high-end camera lenses, especially those used for intelligence, surveillance and reconnaissance, according to the U.S. Air Force Magazine.

Another rare-earth mineral, europium phosphorescence, is an important component of nuclear reactor control rods because of its unique neutron-absorbing properties.

“If all of these non-ferrous materials come from mainland China, then cutting-edge weapons are disguisedly dependent on the Chinese Communist Party. If the Quadruple Alliance can guarantee the supply of rare earths, it can guarantee the security of production of high-tech sophisticated weapons systems.” He said.