BEIJING, June 23 (UPI) -- China has doubled or tripled the prices of some rare earth metals, raising concerns about global supplies of the 17 elements, crucial for green energy and high-tech components.
Just in the last three weeks europium oxide, used in the manufacturing of energy-saving light bulbs, plasma TVs and smartphones has nearly tripled in price from about $1,260 a kilogram to $3,400, The Guardian newspaper reports.
And dysprosium oxide, used for neodymium-iron-boron magnets found in wind turbines and computer hard drives, has doubled from about $720 a kilogram to $1,470.
Already, Beijing cut its export quotas on rare earths by 72 percent in the second half of last year, reducing them further by 35 percent in the first half of 2011.
The latest price hike followed an announcement by the Chinese government that it was closing 35 small mines in Inner Mongolia as part of a clampdown on illegal mining. More closures are expected, fueling fears that there will be more export quotas.
China has maintained that it has adopted strict exploration and export regulations after rampant exploration caused heavy environmental pollution.
But experts have said that China began stockpiling rare earths in 2010, and the scheme could eventually store up to 200,000 tons of the elements, almost twice the country's annual production. Furthermore, they say China's tactic of restricting supply is a ploy to force Western manufacturers to move production, along with their technological secrets, to China to gain access to rare earths.
While China has about one-third of global rare earth deposits, it produces about 95 percent of the world's supply.
China's previous policy of low pricing for the minerals "has killed the rest of the world's ability" to produce rare-earths, said John Kaiser, a mining expert and rare earths specialist in California, the United Kingdom's Daily Mail newspaper reports. Mines in other countries couldn't have competed price-wise or with China's lax environmental and safety laws.
'If China was the only place in the world that rare earths existed, there would be a war. There is no immediate crisis, but a looming crisis that needs to be dealt with," Kaiser said.
'It's the long term that manufacturers need to worry about," said Kaiser. "Toyota, for example, does not have a long-term guarantee of supply. If it wants to plan for the future and pump out millions of electric cars, it needs to invest in a guaranteed supply."
But Mike O'Driscoll, editor of Industrial Minerals, said most experts are predicting a crisis point will be reached in 2014 and 2015.