Rare Earths - The Secret Ingredients of Everything

I became interested in the rare earths about 2 years ago from an investment point of view.  From smart phones to hybrid vehicles to cordless power drills, devices we all desire are made with a pinch of rare earths—exotic elements that right now come mostly from China.

National Geographic just ran a short spread on the minerals by Tim Folger in the June issue linked here.

An extract of the intro is below...

Most of us would be hard-pressed to locate Inner Mongolia, Jiangxi, or Guangdong on a map. Yet many of the high-tech devices we depend on—cell phones, laptops, and hundreds of others—would not exist without an obscure group of elements mined, sometimes illegally, in those three and other regions of China.

China Now Has A Monopoly Producing 97% of All Rare Earths

Rare earths, as the elements are called, were discovered beginning in the late 18th century as oxidized minerals—hence "earths." They're actually metals, and they aren't really rare; they're just scattered. A handful of dirt from your backyard would probably contain a smidgen, maybe a few parts per million. The rarest rare earth is nearly 200 times more abundant than gold. But deposits large and concentrated enough to be worth mining are indeed rare.

The list of things that contain rare earths is almost endless. Magnets made with them are much more powerful than conventional magnets and weigh less; that's one reason so many electronic devices have gotten so small. Rare earths are also essential to a host of green machines, including hybrid cars and wind turbines. The battery in a single Toyota Prius contains more than 20 pounds of the rare earth element lanthanum; the magnet in a large wind turbine may contain 500 pounds or more of neodymium. The U.S. military needs rare earths for night-vision goggles, cruise missiles, and other weapons.

"They're all around you," says Karl Gschneidner, a senior metallurgist with the Department of Energy's Ames Laboratory in Ames, Iowa, who has studied rare earth elements for more than 50 years. "The phosphors in your TV—the red color comes from an element called europium. The catalytic converter on your exhaust system contains cerium and lanthanum. They're hidden unless you know about them, so most people never worried about them as long as they could keep buying them."

Now a lot of people are worried. Read full story here.  An earlier article from 2010 is linked here.

For those interested in Rare Earth as an investment opportunity, listen to this James Dines interview at Financial Sense linked here.