An Australian miner racing to interrupt China’s global stranglehold of rare earths says the Asian powerhouse is manipulating useful resource costs, posing an “existential threat” to Western international locations.
Chinese Premier Li Qiang capped his go to to Australia final Tuesday at a lithium processing plant in resource-rich Western Australia, marking China’s push to retain management of the world’s essential minerals and rare earths.
Chinese Premier Li Qiang visits the Tianqi Lithium plant in Kwinana, south of Perth.Credit: Trevor Collens
Around the identical time, the boss of $2.7 billion ASX-listed Iluka Resources, Tom O’Leary, was warning members at a global mining convention in Japan concerning the “uncomfortable reality” behind China’s superiority.
“China’s dominance of the rare earths supply chain has led to market failure, and this presents an existential threat to manufacturing in Western and like-minded countries,” O’Leary mentioned.
Beijing’s monopoly of rare earths is being leveraged to regulate costs, O’Leary maintains. He mentioned that important value swings on the Asian Metal index over the previous three and a half years point out the value is being manipulated by China.
“Most telling is the price fall, from the peak in early 2022, which occurred almost immediately following what was effectively a Chinese government directive to its rare earth firms to ‘jointly guide product prices to return to rationality’,” he mentioned.
Independent forecasters level to a future provide squeeze and rising costs, but Asian Metal index costs for rare earths stay at historic lows. At in the present day’s index costs, no producer, no matter location, is making any cash, O’Leary mentioned.
China makes greater than 90 per cent of the world’s rare earth oxides and monopolises the global provide of two heavy rare earth parts – dysprosium and terbium. It can extract earnings anyplace alongside the availability chain.
Both parts are used to make high-strength magnets for 1000’s of defence purposes, electrical motors and drivetrains in wind generators.
