Big auto in the U.S., along with the current administration in Washington D.C., are both about to experience growing pains as we pivot to EVs. The problem of missing microprocessors can’t even start to scratch the surface of other issues electrification will run into, namely those of rare earth mining and processing.
The U.S. will now have to choose between adding much-needed mining and processing capacity for the rare earth minerals that EVs need, or risk letting other countries dominate that sector, according to a new report from the Financial Times. Adding mining capacity is a dirty endeavor, as the residents of a South Texas town articulated in the FT report, saying “Hello, more pollution.”
The residents of Hondo, Texas, are right, which is why a lot of first-world countries have been happy to offload the problem to China, as the FT cites:
“This is gross, dirty and polluting stuff,” said Aaron Mintzes, senior policy counsel at environmental group Earthworks, about mining rare earths. “And, frankly, it’s why it happens in China.” Processing the mined rare earths, which happens once they are extracted from the ground, can also create wastewater.
China may not be the only source of rare earth minerals, but it is the biggest processor of these in the world right now. So, its labor is going to be essential to the production of EVs, which will ramp up substantially in the near future.
It’s not like the U.S. hasn’t tried to address the problem, but the country has had a hard time doing this. As the FT highlights, large mining projects are in the works, but there is only one operational mine in the U.S. at the moment, previously owned by Molycorp, and now owned by MP Materials:
The US has been trying to encourage its own industry for more than a decade. The risks of relying on China were highlighted by Beijing’s move in 2010 to cut off exports of rare earth elements to Japan, prompting a World Trade Organization dispute. China was ultimately forced to roll back its controls.
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The US currently has one operational rare earths mine, Mountain Pass, in California. However, Molycorp, the only big rare earths producer in the country, went bankrupt in 2015, resulting in the mine’s closure at the time. The US Department of Defense is supporting the resumption of activity there by funding MP Materials, a private equity-backed company, and it has restarted excavations. Once unearthed, materials must still be sent to China for processing, because the US lacks a full supply chain that can process the mined minerals into usable form.
The Mountain Pass mine shut down a few years ago, per the FT, and that’s probably why this video of the project below dates back to 2014:
The U.S. Department of Defense had to step in and help MP Materials get operations up and running, which is weird enough, and yet, the mine still has to send its product to China for processing.
Again, because that processing is a dirty proposition that the U.S. has been reticent to take on. It’s possible that growth in the sector could produce alternative (and cleaner) ways to go about this, as the report suggests, citing environmental groups:
Earthworks’ Mintzes said recycling batteries and focusing on new extraction techniques from existing waste should form the backbone of any growth in the US industry. “We need to recycle, reuse and substitute minerals,” he said. “That’s where a lot of our focus needs to be.”
The problem there is that exploring and perfecting new mining techniques is easier said than done. Progress is needed, but it’s also slow; meanwhile, China will keep processing the rare earth minerals amid the booming EV market. Unless, of course, we can hurry up and find better ways to extract and process these materials.
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