Rare earth elements are not actually rare. They’re relatively abundant in the Earth’s crust, but so thinly scattered that only rarely are they sufficiently concentrated in (economically viable by Western standards) mineable ore deposits. Additionally, mining REEs can be environmentally hazardous.
As I reported last April, China currently mines and produces 95% of all rare earth materials needed in the production of lithium car batteries, solar panels, wind turbines, flat-screen TV, compact fluorescent light bulbs and defense components such as missile guidance systems.
Its near monopoly makes it possible to dictate terms of sale that include insisting that manufacturers move their operations to Chinese soil. Additionally, the Chinese government keeps prices high by rationing exports and places trade embargoes on nations that don’t go along with its policy/political interests.
In 2010, Beijing reduced rare earth shipments by 9% over the previous year and plans to reduce exports by an additional 35%.
Both Toyota and Phillips developed innovative materials and manufacturing processes that eliminate the need for using as many REEs as they had in the past.
The current dispute between Japan and China about the Diaoyu Islands resulted in a REE supply breakdown, forcing Japan to look elsewhere for its REE supply.
So in addition to innovation, Japan is going into acquisition and exploration to free itself from China’s dictates.
Yesterday’s Australian International Business Times announced that Toyotsu Rare Earth Canada Inc (TRECan), a subsidiary of Toyota-Tsusho Corp (TTC) paid US$1.3 million, the first of a series of payments for its equity acquisition of 49% undivided interest in KIPAWA HREE (heavy rare earth elements) Deposit of Matamec Explorations Inc. In total, Matamec will receive CAN$16 million from TRECan for its equity interest in the deposit.
In a press release on its website, Matamec describes itself as a “junior mining exploration company” focused on exploring, in partnership with Toyotsu, for heavy rare earth deposits in Kipawa, Quebec. It’s also exploring for the REEs yttrium, zirconium, niobium and tantalum in its Kipawa Alkalic Complex.
Matamec is exploring for gold, base metals and platinum group metals as well. Its gold portfolio includes the Matheson JV property located in close proximity to the Hoyle Pond Mine in the prolific mining camp of Timmins, Ontario.
Sources: Geology International Business Times, November 5, 2012 SmartPlanet Daily, November 5, 2012