While many first think of the human dimension and health implications of the recent outbreak and ongoing spread of the coronavirus — and quite rightly, given the potentially fatal consequences — the crisis with pandemic potential has ramifications that reach far beyond the health sector. In a new piece for Tech Metal News, Shane Lasley takes a closer look. He writes:
“Instead of export restrictions resulting from politics or trade disputes, it now seems that the novel coronavirus pneumonia (NCP) outbreak could leave the U.S. and the rest of the world with an REE shortage.”
The spread of the virus, which originated in Wuhan, capital of the Chinese province of Hubei, earlier this year, has indeed had – in the words of analyst Jack Lifton, a “foreseeable but unintended consequence.”
As Lasley outlines, an increasingly limited workforce and slowed transportation as truck drivers refuse to enter areas of concern and travel is restricted have prompted reports that China’s rare earth sector has slowed “to a crawl” and is currently “running at about 20 percent capacity.” This has prompted industry experts to warn that “dwindling REE stockpiles could result in supply chain disruptions both within the country and globally,” if the“sector does not get back up and running soon.”
To ARPN Principal Daniel McGroarty, whom Lasley quotes throughout his piece, this prospect is hardly surprising. He says:
“It’s not necessary to predict how severe the coronavirus will be or how long it will last, to see even at this early point that, in our interconnected global economy, near single-source reliance for a critical material is a vulnerability.”
…All of which underscores the need for the United States to diversify its sources of mineral resource supplies — for rare earths and beyond.
“Saying an event is a ‘black swan,’ beyond anyone’s power to predict, is no excuse for failing to develop more diverse supply. (…) Just as world health organizations are laser-focused on developing an anti-virus vaccine, we’ve got to take steps to ensure the U.S. economy builds up its immunity to global shocks that can destroy growth and GDP – and a key part of that is avoiding extreme dependencies on any one country for critical minerals.”
Steps taken over the past few months point in the right direction, and have resulted in U.S. domestic production of“critical rare-earth mineral concentrates [having] increased by 8,000 metric tons (over 44%) in 2019 to 26,000 metric tons, making the U.S. the largest producer of rare-earth mineral concentrates outside of China,”according to USGS.
However, it is important to note that all of the U.S.-produced rare earths concentrate was exported to China for separation into individual rare earth elements, since that portion of the supply chain doesn’t exist in the United States.
Here’s hoping that policy makers well beyond the public health sector see the coronavirus as a the wake-up call that it is.