4 April
Dear Iain Duncan Smith,
I hope this letter finds you well. I recently attended an event by the Ribble Valley Conservatives where you were their guest speaker. It seems many of those attending that night had questions to put to you, for which you gladly answered. I was unfortunately not lucky enough to pose my own question to you in person, and so I have taken to using this platform, for which I am an early advocate of, to do so.
My question is regarding the mining, refining, and use of rare earth metals of which the PRC has a 90% hold on the global mid-stream production of these. With the demand for rare earth metals expected to increase by 500% by the middle of this century, and that the PRC has become a strategic threat for the free world including the UK, the question is what can we do to move away from reliance on Chinese supply chains and become much more self sufficient in amongst our allies when it comes to this highly important part of our modern world?
Looking at reports by the Council on Geostrategy and the China Research Group, it seems this task is going to be very difficult indeed. However, this task is going to be of utmost importance as our net-zero policy requires enormous amounts of these minerals, and that our defence relies heavily on the sourcing of these to manufacture missiles and the like.
China has shifted its policy on this recently, by focusing more on state backed refining rather than mining. The latter being left to China's partners in Africa and Latin America, through Chinese mining firms and the BRI. For us then, it is a two tier problem. Firstly the access to the ore being mined, and secondly the processing of this ore.
Accessing the mines would require careful diplomacy, and the kind of statecraft seen during the Cold War when countering Soviet influence schemes, albeit this time much more entwined with the private sector. That being said, private business is unlikely to be able to compete to unfair practises that state sponsorship gives rise to, where China is well practiced.
The processing of the ore is another issue that is more domestic. Having been dependant on Chinese processing for a while, it will take time for us to upskill our own workforces on the necessities of that industry. All the while, we will need to contend with the environmental element. Being that rare earth processing is a carbon intensive exercise, and that the Chinese have far fewer concerns about the environment than we do, we are already at a distinct disadvantage from day one. I do think the environment is highly important, but it means that our task of re-patriating rare earth processing is going to be doubly difficult as a result.
The Chinese government deemed this industry a strategic importance in 1990, but it seems we didn't, and we have allowed our selves to be beholden to that regime. If we should pursue the goal of bringing back strategic industries, we can expect China to resist such moves through it's usual means of coercion and distorting the market by controlling export quotas.
We have gotten ourselves into a sticky trap. How do we wriggle free?
Dale Joseph Ferrier
Dale Joseph Ferrier