China to Raise Prices on Rare Earths

The rare earths are major ingredients in our high tech society and China is the worlds major supplier, mainly because the US decided to shut down its production for environmental reasons. Now China is going to charge for their environmental costs as reported in China Daily:

The era of cheap rare earth supplies from China is doomed to end as the country tightens control over the precious resources out of environmental concerns, Chinese lawmakers said on the sidelines of the parliamentary session. China has been supplying enormous quantities of rare earth products to the world. However, environmental costs were not included in the pricing of the commodities, said Liao Jinqiu, an economist at Jiangxi University of Finance and Economics. "The exploitation of rare earths should be further integrated, and a rare earth industry chain must be forged so as to ease the environmental pressure created by excessive extraction," said Liao, also a deputy to the National People's Congress. China is believed to have abundant reserves of rare earth metals, a group of 17 elements that are vital for manufacturing an array of high-tech products, including cell phones, wind turbines, electric car batteries and missiles.  China now produces more than 90 percent of the world's rare earth products, but its reserves only account for about one-third of the world's total.

 China is being both prudent and controlling in this action. However the use of rare earths is increasing in our high tech society and total costs should be reflected but at the same time this may open the window for the US to reconsider the fact that we have an equal amount of rare earth reserves as does China.

In many ways the rare earth issue is a microcosm of the oil issue, we have both, but we refuse to prudently use them and place the burden on others, yet at an ever increasing cost.