The hidden costs of China's rare-earth trade

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The hidden costs of China's rare-earth trade
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Rare earth elements are needed to create high-tech products like smartphones, and electric cars. But mining rare earth in China has resulted in so-called 'cancer villages” that impoverished residents cannot escape.

and straw hats, bearing white banners with handwritten characters that read: “Return the land to me.”

The results are jarring: In mineral-rich regions of China, poisoned water and soil have caused abnormal disease rates in “cancer villages” from which impoverished residents cannot afford to move. Crops and animals have died around a crusty lake of radioactive black sludge formed from mining waste near a major mining site in Baotou, Inner Mongolia. It’s so large that it is visible by satellite.

Locals said they eventually noticed the smell of sulfur and gaping pits of contaminated wastewater seeping into their farms and villages. In 2015, they protested, hoisting signs that read, “Mountains of gold and silver are not as good as mountains of blue and green.” “Rare earth is a special-privilege resource,” said Qin. “Other minerals are mined with local permits from the local government. Rare-earth permits come from the central government.”

The U.S. has exempted rare-earth imports from tariffs, while China has placed tariffs of 25% on rare earth from the United States. China’s advancement up the supply chain has been in plain sight for decades and enabled by companies’ prioritization of low costs above supply security, said Gareth Hatch, co-founder of Technology Metals Research.

In 2010, alarmed by China cutting rare-earth exports to Japan, Congress asked the Government Accountability Office to evaluate the U.S. defense supply chain’s vulnerabilities. Lynas recently signed an agreement with Blue Line Corp. to build a rare-earths separation facility in Texas. “As long as there is surface or underground water, all kinds of dangerous materials will go into the surroundings of the mining area and all the farms nearby,” he said. “They are pouring chemical acids directly into the earth.”

Some environmentalists suggest rare earth should be treated as a conflict mineral, the way “blood diamonds” are, especially as demand increases.

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