The Defense Implications of Rare Earth Shortages – China produces more than 94 percent of the world’s rare earth oxides

Rare earth elements are essential in a number of products crucial to the operations of the U.S. military. Indeed, rare earth phosphors, metals, alloys and magnets are regularly used in laser designators, jet aircraft engines and missiles, to name a few applications, says Jeffery A. Green, the founder of the Strategic Material Advisory Council and an adjunct scholar with the National Center for Policy Analysis. For the supply of these resources, the Department of Defense (DOD) said in recent statements that it will rely upon international markets. However, rare earth elements are just that — rare — and the world’s limited supply is concentrated in a country that is solidifying its reputation as a trade manipulator. The Chinese central government has offered direct support to the rare earth elements industry since the 1980s, allowing it to come to dominate global production. China produces more than 94 percent of the world’s rare earth oxides, virtually 100 percent of all commercially available rare earth metals, and more than 90 percent of the rare earth alloys. China manufactures approximately 75 percent of the world’s samarium-cobalt magnets and 60 percent of the neo magnets — crucial tools for DOD production needs. While relying upon Chinese manufacturers to meet demand (the United States has almost no domestic production in this market anymore) may not be an inherently bad idea, Chinese trade practices lend little reliability to this supply line.

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