China has been capable of completely lower off Europe and the U.S. from a number of important uncommon earth metals. How did it develop such a stranglehold on an trade the U.S. as soon as managed?
AILSA CHANG, HOST:
Now we’re going to check out Beijing’s close to monopoly on refining uncommon earths. Emily Feng stories on how China developed a stranglehold on them.
EMILY FENG, BYLINE: Uncommon earths at the moment are so coveted, some persons are stockpiling them in vaults.
LOUIS O’CONNOR: Make no mistake – I imply, there’s 3 1/2-meter partitions and doorways and armed safety.
FENG: That is Louis O’Connor. He helps run a agency the place traders should purchase into shares of uncommon earths he shops in an underground vault in Germany. China put export restrictions on seven kinds of uncommon earths this spring in response to U.S. tariffs, and O’Connor says he and his traders felt the crunch instantly.
O’CONNOR: They’re putting in what you would possibly name a faucet system the place they’ll flip that faucet on and off.
FENG: And when China turned that faucet off this spring, the U.S. felt the pinch. However as late because the Eighties, nevertheless, it was the U.S. that dominated uncommon earths at a mine in California known as Mountain Cross. Mark Smith was once an government at Molycorp, a rare-earth-producing firm there.
MARK SMITH: At its heyday, it truly was producing 100% of the europium – which is a heavy uncommon earth – that the world wanted.
FENG: Then China noticed the potential of those minerals. They wished to be taught from the U.S. So Smith says beginning within the Sixties, Chinese language executives started visiting Mountain Cross.
SMITH: We toured them. We defined what we do, allowed them to take footage and the whole lot else. They took it again to China.
FENG: Then Chinese language firms ramped up their manufacturing and undercut world costs. However the trade in China on the time was extremely unregulated and polluting. Here is Smith once more. He ceaselessly visited China throughout this era.
SMITH: They might mine the facet of the hill. They’d pour five-gallon buckets of sulfuric acid or hydrochloric acid, pour their ore in it and let that sit and stew for some time, after which they’d take the liquor again into the five-gallon jugs.
FENG: All of this, after all, created enormous environmental issues. And by the late Nineteen Nineties, Beijing had had sufficient. It began imposing manufacturing and export quotas to cease value wars, restrict air pollution and restrict international involvement. Rod Eggert teaches mineral economics on the Colorado College of Mines. He explains these quotas created two units of costs. These controls additionally had the unintended consequence of making a thriving smuggling trade…
ROD EGGERT: And so there was an incentive for undocumented or unlawful or unsanctioned exports.
FENG: …To get round export limits. Teachers estimate as much as a 3rd of the nation’s uncommon earth merchandise within the mid-2000s have been unlawful – smuggled out of China. Plus, in 2014, the World Commerce Group dominated towards these export limits. However China was already shifting techniques.
(SOUNDBITE OF ARCHIVED RECORDING)
UNIDENTIFIED PERSON #1: (Talking Mandarin).
FENG: China was consolidating. In 2012, it began policing smaller mines, even blowing up unlawful operations.
(SOUNDBITE OF ARCHIVED RECORDING)
UNIDENTIFIED PERSON #2: (Talking Mandarin).
FENG: China closed down lots of of unlawful mines and refineries, then shaped simply six supersized, principally state-owned companies, nicknamed the Large Six, in China. China might now management each provide and value by means of the Large Six. And at present, Chinese language firms principally set the worth for uncommon earths.
(CROSSTALK)
FENG: However American companies have been looking for methods to beat China’s dominance.
UNIDENTIFIED PERSON #3: The stuff on the backside is that chemical that I used to be speaking about that permits you to separate…
FENG: Corporations like this one, known as Phoenix Tailings – it is a Massachusetts startup that takes mining waste and extracts the uncommon earths inside.
I simply – I like that you’ve got a vat labeled acid.
(LAUGHTER)
FENG: I can’t contact that.
UNIDENTIFIED PERSON #3: Please don’t.
FENG: They’re one among only a handful of American firms ready to refine uncommon earths. Here is Nick Myers, one of many co-founders.
NICK MYERS: Our main clients are within the automotive sector.
FENG: However like different American uncommon earth firms, they are saying it was exhausting to get capital and to achieve traction, partially as a result of China has a lot market share. Then, this 12 months, issues modified.
MYERS: Particular tone shift – I believe what occurred is the oldsters on the huge automotive firms or protection primes realized that that they had instructed their bosses that China would by no means shut off the provision for them.
FENG: However this 12 months, China did shut off provide. Phoenix Tailings bought an enormous spherical of funding, they usually and different American firms are hoping to lastly catch as much as China.
Emily Feng, NPR Information, Burlington, Massachusetts.
Copyright © 2025 NPR. All rights reserved. Go to our web site phrases of use and permissions pages at www.npr.org for additional data.
Accuracy and availability of NPR transcripts could range. Transcript textual content could also be revised to right errors or match updates to audio. Audio on npr.org could also be edited after its authentic broadcast or publication. The authoritative file of NPR’s programming is the audio file.
