PCG: China Controlling Strategic Minerals

Neodymium Magnet on a Hard Drive

The April 2008 edition of PCG’s Trumpet has the following in an article on minerals:

As America has been divesting itself of mineral-producing capacity, other nations have been quick to embrace it. Unfortunately for the U.S., the ability to control global production of strategic minerals is an incredibly powerful political weapon.

China, for example, now completely dominates rare earth minerals—minerals that the U.S. supplied over 20 percent of not long ago.

“The whole family of ‘-ums’ like gallium, rhenium, neodymium and indium, is fascinating. And frightening!” reports the Miner Diaries investment bulletin. “They are an essential ingredient in many technology-related sectors and demand is growing at 10-to-15 percent a year.

“Yet it is completely dominated by just one country—around 95 percent of supply comes from China” (Jan. 30, 2008).

Over the past two years, China has begun restricting exports of these materials. The end result is, U.S. manufacturers who wish to stay in business are being forced to move their research and development and manufacturing facilities to China to gain access to rare earth minerals. An example of this was the sale and relocation of Magnequench, a company formerly based in Indiana that produced 85 percent of the rare earth magnets used in the guidance systems of U.S. military smart bombs. Without rare earths, you don’t have protective coatings, blast protection, guided missiles, lasers, modern transportation, laptop computers, tvs, or even iPods.

In 1992, China basically admitted to the world what it was planning to do. Chinese ruler Deng Xiaoping coined the statement, “There is oil in the Middle East, there is rare earth in China.” Then in 1999, Chinese President Jiang Zemin said, “Improve the development and applications of rare earth, and change [China’s] resource advantage into economic superiority.”

Meanwhile, America has closed its only rare earth mine (one owned by Unocal, which the Chinese state-owned company cnooc tried to purchase in 2005), has boarded up the Rare Earth Information Center, and has not only ceased stockpiling rare earth minerals but has also largely sold off national stockpiles.

If any doubt exists as to China’s intentions, on February 4 Chinese state-owned companies announced four deals in the resources sector. The deals came only two days after Chinalco, China’s aluminum company, grabbed a 12 percent stake in Rio Tinto to prevent the Australian mining giant bhpBilliton from gaining control over the $132 billion diversified mining giant.

The Times called China’s action “the first shots in a new economic war.”

The mineral crisis is only one of many that the USA is facing.

Between USA debt, food imports, dependence of foreign energy & goods, moral problems, and a lack of repentance of our national sins, the USA is setting itself up for a massive fall.

A bigger fall than most Americans can even imagine. Those interested in some of the details should read the Book of Lamentations and the second chapter of the Book of Habakkuk. In addition, some of what will happen to the USA is discussed in the article Who is the King of the North?

Perhaps, I should add that because of economic disparities, grain/food shortages, pollution, and the potential for a major disease outbreak, China itself may face some internal revolts and other crises, even though it has many strategic resources now (an article of related interest may include China, Its Biblical Past and Future, Part 3: Asia in Prophecy).