Innovation as Resource and China's New Magnetism

Innovation as Resource and China's New Magnetism
BY Jamais CascioWed Jan 6, 2010 at 1:00 PM
China is set to cut off access to rare-earth elements--and this might be a very good thing.

You've probably seen "neodymium" (actually neodymium-iron-boron) magnets advertised in techie-oriented magazines and gadget blogs. They're actually the strongest type of magnet available, and a pair of them can easily smash fingers. They're also incredibly useful, with small neodymium magnets found in everything from hard drives to wind turbines. Neodymium is one of 17 "rare-earth metals," and these elements have turned out to be critical to the rapidly-growing green technology industries. Rare-earth metals are used in hybrid and electric cars and low-energy lightbulbs, along with windmills (and numerous other greentech applications).

And China is the source for over 95% of the rare-earth metals now in use--something that increasingly looks like a problem. How we respond to this problem can tell us something about how we can respond to other imminent resource and sustainability crises.

Conventional wisdom says that we live in a globalized economy and if China can offer the metals at cheaper prices than other sources (namely, now-closed mines in South Africa, Greenland, and Canada), it's good for us all, right? The fact that many high-tech military technologies rely on Chinese rare-earth metals may give some people pause, but so far, so good. But that model assumes that China is willing to sell as much mineral as it can produce, to whomever wants to buy--and that assumption may no longer be true.

The U.K.'s Independent reports that China has been gradually cutting the amount of rare-earth elements it exports, now down 40% from seven years ago. China now exports only 25% of the rare-earth elements it mines. More worrisome, they say:

Industry sources have told The Independent that China could halt shipments of at least two metals as early as next year, and that by 2012 it is likely to be producing only enough REE ore to satisfy its own booming domestic demand, creating a potential crisis as Western countries rush to find alternative supplies... Beijing announced last month that it was setting exports at 35,000 tonnes for each of the next six years, barely enough to satisfy demand in Japan. From this year, Toyota alone will produce annually one million of its hybrid Prius cars, each of which contains 16kg of rare earths. By 2014, global demand for rare earths is predicted to reach 200,000 tonnes a year as the green revolution takes hold.

With industries relying on rare-earth elements making up a rapidly-growing part of the global economy, this isn't good.

So what are our options? We (as in, the non-China parts of the industrialized world) could try to pressure China to sell more, but that's unlikely to work--and China tends not to respond well to even mild criticism. We could try to rapidly reopen the now-closed rare-earth element mines, but mining is, frankly, an environmental nightmare and incredibly dangerous--hardly a sustainable practice.

Our best option is to innovate our way out of the problem. Ideally, we'd figure out a way to make what we need without those elements. In the shorter term, however, we'd want to figure out a way to obtain those necessary elements without either trying to push China around or reopening dirty mines. If the innovation manages to help solve an otherwise unrelated problem, too--a so-called "economy of scope"--so much the better.

Researchers from Leeds' Faculty of Engineering have discovered how to recover significant quantities of rare-earth oxides, present in titanium dioxide minerals. [...] The Leeds breakthrough came as Professor Jha and his team were fine-tuning a patented industrial process they have developed to extract higher yields of titanium dioxide and refine it to over 99 per cent purity. Not only does the technology eliminate hazardous wastes, cut costs and carbon dioxide emissions, the team also discovered they can extract significant quantities of rare earth metal oxides as co-products of the refining process.

This is, to me, a perfect example of how we should deal with resource problems. Not by simply fighting over the remaining scraps, or trying to get at marginal sources, but by looking at ways to increase supplies while reducing waste, with methods that have a smaller impact on the planet.

Can we do it for every limited resource? Probably not--but focusing research into how to use resources more efficiently, how to extract the resources with less waste, and ultimately how to move beyond them entirely will bring enormous benefits.