China's rare earth processing capacity is globally leading, and it is difficult to be replaced in the short to medium term.

German media: Study: Rare earths from China are irreplaceable in the short to medium term

The Frankfurter Allgemeine Zeitung cited a new report published by the Austrian Institute for Supply Chain Information (ASCII) which states that the dependence of European and American countries on Chinese rare earth products is more serious than previously assessed, and this situation will be difficult to improve in the short to medium term:

"During the peak of globalization, low-profit and high-environmental-cost raw material processing operations were transferred to China in large numbers, a process that has led China to establish a monopolistic position in certain areas. According to a report by the Austrian Institute for Supply Chain Information, China controls 91% of the global rare earth processing capacity, and there is no other alternative source in the 'heavy rare earth' sector.

Data from the German Raw Materials Agency also shows similar conclusions. These processed metals are almost irreplaceable core materials for all technological products. Without them, it would be impossible to produce chips, cars, energy transition products or military equipment.

Beijing has repeatedly used the supply of specific raw materials as a means of pressure, and has threatened to strengthen export controls. After the escalation of the US-China trade conflict this spring, the supply of rare earths was interrupted for several weeks. Although Beijing denied that this was a sanction measure and stated that the supply tightness was caused by a backlog of export applications, industry insiders still generally suspect a direct link with the trade war.

The United States is making every effort to reduce its reliance on China. Although the EU has launched the Critical Raw Materials Act and decided to invest heavily in domestic mining projects, calculations by the ASCII Institute show that by 2040, Europe's reliance on Chinese rare earths will still be as high as 85%. The study emphasizes that focusing only on mineral ore mining is not sufficient to solve the problem.

More importantly, China controls key intermediate production processes, thereby having a 'strategic gatekeeper' status, which significantly affects the supply of global core technologies, and thus affects Europe's economic future."

Original: www.toutiao.com/article/1839902396748812/

Statement: This article represents the views of the author.