Tuesday, November 13, 2012

Scarce Strategic Mineral Alternative Sourcing Likely To Leave US Supply Chain At Risk Over Next 3-5 Years

Key Findings:
Due to lack of alternative strategic mineral sources, susceptibility to supply chain vulnerabilities likely to persist in next 3-5 years:

The biggest risk the US faces is likely supply chain vulnerabilities:
  • US imports 80 percent of all strategic minerals.
  • US imports 28.4 percent of strategic minerals from China.
  • Strategic minerals highly likely to remain essential for key industries, including defense, electronics and energy.
  • National mining likely presents opportunity to reduce import dependence.
  • One US company currently pursuing strategic mineral mining in the Arctic.
  • Legislation to quicken mine opening unlikely to pass Congress.

Arctic likely opportunity to reduce dependence:
  • US abuts Arctic region, allowing for undisputed access to resources.
  • US federal government issued call to explore Arctic region for strategic minerals.
  • China is likely to continue expanding its mining operations outside its mainland to include Africa and the Arctic.
  • Greenland, with growing access due to ice shelf melt, is likely an opportunity for domestic mining; however, little is being pursued presently.

Law enforcement highly likely most at risk:
  • Dependent on businesses and federal government for critical supplies, making its supply chain likely at high risk for potential disruptions.
  • State-by-state legislation likely impedes proactive, unified response to supply chain risk.
  • Metal theft likely to remain top strategic mineral priority for law enforcement.

About This Document:
The eleven students of the Collaborative Intelligence class assembled this document. Students researched and analyzed findings over the 2012 autumn term at Mercyhurst University. The class split into three teams with each team responsible for a specific topic. Four students were assigned to research national security issues, four were assigned to research business issues, and three students were assigned to research law enforcement issues. All three teams were tasked to answer the following question: “What are the likely US national security, business and law enforcement implications over the next 3-5 years of trends in critical or strategic minerals?” Teams collaborated to establish definitions and create a list of “critical strategic minerals.”
This report identifies the following as critical and strategic minerals for US national security, businesses, and law enforcement:
  • Antimony
  • Aragonite
  • Arsenic (trioxide)
  • Asbestos
  • Barite
  • Bismuth
  • Calcite
  • Cesium
  • Chalcocite
  • Chalcopyrite
  • Chromium
  • Cobalt
  • Copper
  • Gallium
  • Germanium
  • Gold
  • Indium
  • Iodine
  • Lithium
  • Magnesium metal
  • Manganese
  • Nickel
  • Niobium
  • Nitrogen (fixed),
  • ammonia
  • Peat
  • Perlite
  • Phosphate rock
  • Platinum-group metals
  • Potash
  • Quartz crystal
  • (industrial)
  • Rare earth elements
  • Rhenium
  • Rubidium
  • Scrap
  • Selenium
  • Strontium
  • Tantalum
  • Tellurium
  • Thallium
  • Thorium
  • Tungsten
  • Vanadium
Overall analytic confidence is moderate. All groups agreed on moderate analytic confidence for each set of group findings. Source reliability varied from medium to high, and sources could be successfully corroborated.

This book is a summary of a ten-week graduate class examining strategic mineral use and implications for US business, national security, and law enforcement. The project is the culmination of the research, along with the estimative findings, of the 11 second-year Intelligence Studies, Collaborative Intelligence (INTL 650) class in the Fall, 2012. It can be viewed and/or downloaded as a PDF from the link below. Scarce Strategic Mineral Alternatives Likely To Leave US Supply Chain At Risk Over Next 3-5 Years

Thursday, October 11, 2012

Top 50 People To Follow In Strategic Minerals

Based on qualitative and quantitative analysis of Twitter users discussing critical and strategic minerals, it is likely that the 50 users listed are best to follow to keep up with developments in the field.

Methods and Processes:

Graduate students from the Collaborative Intelligence course in Mercyhurst University’s Applied Intelligence Program conducted this analysis. Students determined a network of Twitter users through their research related to the business, law enforcement, and national security implications of critical and strategic minerals. From this large network, the students used social network analysis and the ORA software to isolate the most connected users. This resulted in an initial list of 67 users. From there the class collectively researched the number of followers and membership on lists of each user, and determined the ratio of lists to followers, represented in the spreadsheet as a percentage.

Wednesday, October 10, 2012

International Market And Political Issues Likely To Diminish U.S. Ability To Obtain Strategic Minerals

Analytic Question:

What implications will international issues related to critical minerals have on U.S. national security in the next three to five years?

Key Findings:

Over the next three to five years, international issues including market and political conditions are likely to diminish the United States’ ability to obtain strategic minerals.

  • It is highly likely that the Chinese government will continue to bring attention to disputed regions like the Senkaku Islands, the Paracel Islands, and the Spratly Islands in the next 12 to 24 months.

  • It is likely that the national South African mining strikes will continue to affect global supply of minerals.

  • It is likely the United States will implement more regulations to diminish the quantity of central African conflict minerals being trafficked into the world market in the next three to five years.  

  • It is highly unlikely that the United States will exploit the Arctic region to reduce its dependency on other nations for strategic minerals over the next three to five years, despite abundant reserves in the region.

Increased Legislation And Cooperation Between Public And Private Sectors Likely Needed To Curtail Metal Theft In The Next 1-2 Years

Analytic Question: 
What measures could be taken to reduce the frequency of metal theft cases in the United States in the next one to two years?

Key Findings:
Due to an increasing amount of metal theft fueled by rising metal prices, it is likely that law enforcement across the United States will take action to reduce the problem by enacting laws which grant more power to law enforcement agencies and prosecutors, while increasing regulations on scrap yards. Improved legislation and powers granted to law enforcement, combined with education and cooperation with businesses and the public, will likely curtail the overall amount of metal theft. However, it is unlikely to solve the issue, as the practice will likely move underground to an increasingly organized black market, localized in metal theft rings.
  • Due to the lack of a federal law designed to combat metal theft and regulate scrap yards, it is likely that enacting a federal law would reduce the amount of metal theft taking place in the United States in the next one to two years. The Metal Theft Prevention Act, proposed by Senator Charles Schumer (D-NY), would likely help resolve many of the problems dealing with the theft of metal within the United States. States would likely build upon this law, as metal theft and scrap yard regulation vary greatly state by state.
  • Due to the high profits and low risk of being caught, it is likely that metal thefts will persist over the next one to two years, mostly in the form of metal theft rings. While new legislation and more power granted to law enforcement will likely deter many, it is unlikely that these actions alone will completely resolve the metal theft epidemic in the next one to two years.
  • In spite of the recent influx of metal thefts, local and state law enforcement agencies are likely to reduce the number of metal thefts over the next one to two years through educating the public on preventative measures and working closely with local recyclers and scrap yards to catch those trying to sell stolen metals. Companies are likely to increase the risk of the crime thus reducing total number of thefts by utilizing simple deterrent techniques such as refusing cash payments for sold metal and by collaborating with local police with theft alert websites like ScrapTheftAlert.com.  

Abbreviated Dissents - There are no dissents over any aspect of this report.

Link to full document: Metal Theft Report

Mineral And Mining Legislation Highly Likely To Hamper US Business

Analytic Question:

How will mineral and mining legislation affect United States businesses in the next three to five years?

Overall Finding:

It is highly likely that mineral and mining legislation will hamper the US business sector over the next three to five years.

Key Findings:
  • Re-opening dormant mines will likely remain the most attractive method to procure strategic minerals domestically
    • Mining industry must adhere to over 80 laws through 20 agencies
    • Opening mines in the US takes, on average, seven years
  • It is likely that the effects of the Dodd-Franks bill on conflict minerals will be far-reaching, across many industries. 
    • Dodd-Franks legislation creates a competitive disadvantage for US public industries
    • US industries could incur between USD 3 and 4 billion in implementing Dodd-Franks legislation
  • It is likely that passage of US Congressional bills relating to strategic and rare earth minerals would improve the job market; however it is unlikely legislation will be implemented
    • Only 29 percent of bills sent to the floor for a vote pass both the US Senate and Congress
    • Ten strategic mineral-related bills have been introduced to the 112th Congress
  • In spite of growing non-Chinese supply of minerals, US businesses are likely to remain heavily dependent on Chinese rare-earth sources.
    • A number of strategic minerals, including Rare Earths, are 100 percent imported
    • China supplies 79 percent of the rare earths used by US industries, increasing trade tensions
Mineral and Mining Legislation Highly Likely to Hamper US Businesses

Saturday, October 6, 2012

Rare Earth Plant Delayed Again

Save Malaysia Stop Lynas are the primary activist group
attempting to stop production of rare earths in Malaysia.
KUALA LUMPER, MALAYSIA (NY TIMES) -- A court in Malaysia has delayed the license for Lynas Corp to begin production at a controversial rare earth plant. A decision will be made on October 10th on whether production will be blocked permanently.
The plant is built and ready to go, but production has been delayed due to environmental and safety disputes. It is one of the biggest plant of its kind outside of China and has faced resistance since construction started two years ago.
In order to break China's grip on rare earths supply, plants such as these, need to be built and producing in order to compete. The current delay is based on safety concerns, however, activists are reviewing whether the government has the right to allow the plant to operate. 'Save Malaysia Stop Lynas' has its work cut out as it tries to prevent Lynas corp from starting production at a plant valued well over $800 million.
Source: Malaysian Court Delays Rare Earth Plant (Reliability: High)

Comment: US businesses will be hoping that Lynas corp wins this battle with activists and those wishing to see their license to mine revoked. If China's stranglehold on rare earths and minerals continues, they will control supply and prices of these components that are attributed to technology products, cars and many other industries in the US.

Friday, October 5, 2012

N.C. Scrap Metal Buyer Permitting Law Goes Into Effect 1 October 2012

The act aims to cut down on theft by adding to the
paper trail for the sale of scrap metal; N.C. now has
a cap on cash purchase of metal at 100 USD
KINSTON, NC (FREE PRESS & JONES POST) --In order to address the steady increase in the theft of scrap metals, especially copper, the North Carolina General Assembly recently passed House Bill 199, the Metal Theft Prevention Act. On 1 October, the Act went into law. Now, any business involved in the purchase and recycling of metals must apply to the local sheriff’s office for a permit to be in compliance with the act. The permits are available free of charge and are valid for 12 months at “fixed sites in the county of issuance,” according to the LCSO. The law applies to purchasers of ferrous and nonferrous metals. Nonferrous metals such as copper, aluminum not used in cans and stainless-steel beer kegs do not have large amounts of iron and steel in them.The law also limits cash payments for metals — buyers of nonferrous metals cannot pay cash for copper, and any purchase of other nonferrous metals worth more than $100 must be paid by either check, cash card or money order. “A nonferrous metals purchaser shall not make more than one cash purchase per day from any individual, business, corporation or partnership,” the law states. Scrap yards already had to keep detailed records of customers who brought them scrap metal,  even taking their fingerprints if they brought in catalytic converters, air conditioning condensers or evaporator coils, but the new law also requires them to obtain a permit from the sheriff’s office and get a photo or video of the seller with the materials. Source: New Metal Theft Law Takes Effect Today (Reliability: High)

Comment: This is just one example of the legislature taking action against the increases in copper theft in the US. Law enforcement is attempting to take proactive steps to address these thefts. The permitting process in North Carolina and increased paper trail will likely discourage large-scale theft of copper in the state.

Dodd-Frank Wording Creates Unfairness Amongst Competitors

General Motors must comply with section 1502 of the
Dodd-Frank Act, but competitors like Volkswagen AG
and Daimler AG do not, creating unfairness in the market.
NEW YORK (WSJ) -- The Security Exchange Commission (SEC) recently adopted section 1502 of the Dodd-Frank Act, which requires companies that meet certain criteria to publish if conflict minerals are used in any part of the supply chain for the company. These minerals come from the Congo and surrounding areas, and the proceeds are used to fuel wars and other conflict in the region. Industries impacted by section 1502 include automobile, jewelry, electronics, aerospace, and others. These industries stated that the section will add to costs and is difficult to comply with, as their whole supply chain will have to be audited and new minerals will have to be sourced if it is found that conflict minerals are used. However, even if a company does not have to comply with section 1502, there is a growing movement of corporate responsibility, in which many businesses are removing conflict minerals from their supply chains in order to maintain a favorable reputation. Source: Nuances in Conflict Minerals Rules Creates Uneven Playing Field. (Reliability: High)

Comment: Section 1502 was created to cut off funding to warlords in and around the Congo. It will be years before an assessment can be made to determine if the rule had the desired outcome.

US Far Behind in Race for Arctic Assets

The United States is not look at the Arctic as an investment
BARROW, ALASKA (GLOBALPOST) - The melting of the Arctic has opened up the potential to access oil and minerals beneath the floor of the Arctic Ocean.  Economists are predicting that there could be trillions of dollars in profit in the coming decades.  Alaska Lt. Governor Mead Treadwill believes the United States in not even in competition for the race for oil and minerals in the Arctic.   Despite the profits and opportunities in the Arctic, American administrators are not utilizing the Arctic's potential.  Many international observes believe the US is failing to understand the need and importance to establish itself as a leader in the Arctic.  It will take a long time for the United States to become as active as China and Russia in the Arctic.  The US Coast Guard does not have the resources for the shipping surge or oil exploration, including ice cutters.    Source: US Far Behind in Race for Arctic Assets (Reliability: Medium)

Comments:  The ice in the Arctic Ocean has shrank to an all-time low this year due to man-made global warming.  

South African Mine Strike Spreads To More Mines

As many as 75,000 miners are already on strike. This equates
to about 15 percent of South Africa's mining sector's total workforce.

JOHANNESBURG (REUTERS)- Since Wednesday the mine strike has spread to a new sector: iron ore and it has hit another gold firm. Kumba an industrial unit of the global miner Anglo American, said the mine strike at its giant Sishen Mine in the Northern Cape involved 300 employees. It was limited to one area in the open cast mine, leaving most of the facility unaffected. Kumba is one of the world's top 10 iron ore producers. It produced 41.3 million tonnes of ore in 2011. Kumba's share price dropped more than 4 percent.

The strike is also testing President Jacob Zuma's leadership. The president is under fire for failing to address and contain the workers' protests demanding wage increases. There are glaring wealth inequalities persisting in South Africa since the end of the apartheid in 1994. Source: South Africa Wildcat Strikes Spread To More Mines (Reliability: High)

Comment: The spreading of labor unrest has raised fears that the country could see a repeat of the stand-off with police at Lonmin's platinum mine in August that led to the shooting of 34 miners. It was South Africa's bloodiest security incident since the end of the apartheid in 1994.

Innovation Metals Finishes Plans For Critical Rare-Earth Element Separation Facility

Innovation Metal's Rare-Earth Element Separation Facility
QUEBEC (AZOM) --On 5 October 2012, Innovation Metals announced the completion by GENIVAR Inc. of a set of process flow diagrams ("PFDs") for the extraction and purification stages of IMC's future critical rare-earth element (REE) separation facility in Becancour, Quebec. Starting with a mixed REE carbonate feedstock, produced by blending individual feedstock received from various future REE producers, the process starts with an acid-leaching phase, to solubilize the REEs, followed by a cascade of separation stages based on solvent-extraction techniques. As a result, the process creates formation of thirteen distinct high-purity rare-earth chloride products.
Source: IMC Collaborates to Develop PFDs For Rare-Earth Element Separation Facility (Reliability: High)

Comment: According to Patrick Wong, CEO of IMC, IMC is now one of the only companies outside of China with detailed quantitative designs for a critical REE separation plant.

Disputes in South and East China Seas due to Access to Strategic Mineral

Executive Summary:
The increasing number of territorial disputes in the South and East China Seas are due to control of potential mineral reserves. It is highly likely that the Chinese government will continue to bring attention to disputed regions like the Senkaku Islands, the Parcel Islands and the Spratly Islands in the next 12-24 months. These islands likely contain valuable strategic mineral resources as well as offshore oil deposits.

In mid-September political tensions came to a crescendo as China protested Japan’s continued occupation of the Senakaku Islands, 100 miles north of Taiwan. The islands are believed to contain valuable strategic mineral deposits. The uproar is one event in a series of ongoing disputes involving the PRC. In July, the People’s Liberation Army announced it would be sending a garrison of soldiers to the Parcel Islands, a small island chain claimed by Vietnam.

Map showing disputed territory in the South China SeaThe Philippines announced on Monday that 800 Marines would be sent to the Spratly Islands to further guard territorial claims there. The Spratly Islands are situated near by producing oil and natural gas fields in the South China Sea.

In response to the unrest with, Beijing offered 3 billion RMB to the ASEAN for a maritime cooperation fund. The fund is specifically aimed at cooling tensions with the Philippines and Vietnam. However, to date, the purpose of the fund has not been established, but this illustrates Beijing’s desire to resolve the conflict diplomatically.

Analytical Confidence:
Analytic confidence for this assessment is high.  The analyst did not utilize structured methods of analysis for this report.  Source reliability is high and the sources corroborated each other.  The analysts’ expertise is moderate and the analysts worked alone.  Subject complexity was medium and the time available for the task was abundant.

Methods And Processes:
The analyst worked alone on this document and did not need to use collaborative software or technology. The analyst used Google News searches to identify reliable sources and gather corroborative information.

Contact Information:
For comments, questions, or additional information, please contact the analyst:


Further Delays In Lynas Plant Operation In Malaysia

Malaysian activists protest against a proposed rare earth plant
Protesters are afraid of radioactive waste
THE AUSTRALIAN (SYDNEY) - Lynas in Malaysia is facing further challenges as a Malaysian court has postponed  until 10 October 2012 a hearing on a temporary operating license granted to the Australian miner for a rare earths plant . This court rule further delays the start of operations at the USD800 million facility, which has been opposed by green activists and concerns about radiation. Lynas received the temporary operating license in early September 2012 but Kuantan High Court in eastern Pahang state, where the plant is located, put it on hold later that month after an appeal by protesters. The objective of activists and local residents is to shut down the plant - the biggest outside China - which has emerged as a controversial issue in the campaign for next year national elections. The plant will process material from Lynas' Mount Weld mine in Western Australia. Lynas claims that the plant is safe, and any radioactive waste it produces will only be low-level and not harmful to human health.  Source: Hearing On Lynas Malaysia Plant Postponed (Reliability: Medium)

Comment:  In spite of close relations to Malaysian ruling political parties, Lynas could not open it's processing plant
because of public protests. Widespread protests can endanger future rare earths processing plants all over the world.

Thursday, October 4, 2012

Arctic Region Rich In Resources, Lacking In Framework

The arctic region.
MADRID (Eurasia Review)--Arctic ice has receded more over the past decade than at any other point in history, with summer ice melts making more areas accessible than ever before. The newly-accessible areas of the Arctic hold huge amounts of oil and gas as well as massive stock of high quality gold, diamond, plutonium and other rare earth minerals. A recent CSIS study found that although some Arctic countries (such as Russia) have claimed to support international cooperation in the Arctic, they have bolstered their military presence in the region. Since the region lacks any coherent framework to address international interests and concerns, it remains a potential flash point for all countries bordering the Arctic or with interests there. Source: Restructuring Arctic Stability And Global Security - Analysis (Reliability: Medium)

Comments: With even non-Arctic groups ranging from the EU to China expressing interest in exploiting Arctic resources, Arctic countries such as the US must act quickly if they are to protect their interests in strategic minerals, oil, gas, and even fishing.

Doubt Cast on Afghan MIning

WASHINGTON (WSJ) -- Afghanistan hopes to transform its $1 trillion in mineral deposits into a reliable economic base. However, researchers working for the U.S. military concluded that the cost to build and run a rail network across Afghanistan could cost greater than $54 billion.

A spokesman for Afghanistan's Foreign Ministry questioned the cost estimate and predicted that in the end the benefits of a nationwide rail system would outweigh the costs.  Officials in Afghanistan hope to generate $300 million from mining projects by 2016.  Within 12 years, Afghans hope mining revenues will contribute to half of the country's GDP, yet no large-scale  mining projects are in operation.

U.S. Department of Defense strategists backed the Afghanistan government in selling its biggest mineral interests to Chinese, Indian, Canadian and U.S. companies, from whom it hopes to receive licensing fees and royalties. The U.S. first began to consider minerals as a possible economic boost for Afghanistan in 2010. But U.S researchers outlined hurdles that would be difficult to overcome. It would require up to 3,000 miles of track through 16,000-foot mountain ranges.

Western officials however said Afghanistan would be able to pursue other major projects that use trucks rather than rail.  Source: Doubt Cast on Afghan Mining (Reliability: High)

Comment: According to the USGS, in addition to billions of dollars worth of iron and copper, there is an estimated $25 billion of gold, $81 billion of niobium, and sizable quantities of cobalt, molybdenum, asbestos, silver and other industrial minerals in Afghanistan mines.  U.S business interested in Afghanistan mines would benefit from pursuing the feasibility of strategic mineral mining to lessen our dependency on China. 

Senkaku-Diaoyu Islands Suspected of Holding Valuable Mineral Reserves

TOKYO (NATIONAL PUBLIC RADIO) — Tensions erupted last week between China and Japan over control of a small set of islands that lie 100 miles north of Taiwan. Anti-Japanese protests erupted in many major Chinese cities, including at the Japanese embassy in Beijing. Occupied by Japan since the end of the Second World War, the island chain is believed to contain valuable deposits of minerals, specifically rare earth minerals deemed strategic to national security by many nations.

The issue of possession of the islands was placed on the political back-burner for many decades. Former Chinese leader Deng Xiaoping advised both sides to build up their domestic economies and trade partnership before dealing with the potentially explosive issue.

The territorial dispute is the latest in a series of regional disputes in recent months. In July, the Chinese government announced it would send a military detachment to a group of small islands of the Vietnamese coast in the South China Sea. China and the Philippines also have a long running dispute over the Parcel Islands and Spratly Islands. Japan has a series of ongoing territorial disputes with Korea and Russia over the Dokdo islands and Kurile Islands, respectively.

(Reliability: Moderate)

Comment: The aggressiveness of Chinese territorial claims in the South China Sea have been increasing in the last 12 months. Political disputes and protests on all sides are not new, nor are they unique, as many of these territorial disputes are decades old. However, the expansion of Chinese territorial claims is likely due to an increased likelihood of each claim containing valuable mineral deposits.

Wednesday, October 3, 2012

Great Western Minerals Group To Conduct Yttrium Oxide Assessment for DoD

MICHIGAN (PROACTIVE INVESTORS) - The US Department of Defense announced on 1 October 2012 that it has chosen Great Western Minerals Group's (GWMG) rare earth processing subsidiary, Great Western Technologies of Troy, Michigan, to conduct a supply chain assessment for high purity yttrium oxide.
Yttrium Oxide (Y2O3)

Almost all high-purity yttria is currently produced in China. The DoD uses yttrium oxide in several defense applications such as polishing compounds for precision lasers and thermal barrier coatings for jet engines. The DoD has projected an annual shortfall of 93 short tons of elemental yttrium from domestic sources by 2013.

"We intend to advance previous Department of Defense research to uncover the extent to which the defense industrial base has the capacity to produce high-purity yttrium oxide to support critical defense programs," interim GWMG chief executive Robert Quinn said in a release. Source: Great Western Minerals to conduct yttrium oxide purification assessment for U.S. Department of Defense.
(Reliability: Moderate)

Comments: Since China produces nearly 95 percent of the world's rare earths, and since there are not effective substitutes for yttrium, finding domestic sources for mining and production is likely to become more important to national defense security. The use of yttrium as a component in phosphors and electronics is especially important to US economics and defense applications.

Saturday, September 29, 2012

Gold And Gems Stolen From Cali Museum

The California Mining and Mineral Museum includes
specimens from around the world, including the Fricot
nugget, a mass of crystalline gold from the Gold Rush era. 
MARIPOSA, CALI (FRESNO BEE) -- An estimated $2 million worth of gold nuggets and other precious gems were stolen Friday afternoon from the California State Mining and Mineral Museum, a state parks spokesman said. In the assault, several robbers threatened museum staff with weapons before stealing the gems and gold. According to witnesses, there were two men, one of whom was armed with a pickax. Some of the nuggets are as large as a closed fist, which will make them difficult to sell. Darci Moore, curator of the museum, said that an accurate value of the amount stolen will be unavailable until inventory on the vault can be completed. The thieves also attempted to steal the 13 pound Fricot Nugget, but were unable to break through its casing. Source: Gold, Gems Stolen From Mariposa Museum (Reliability: High)

Comment: With the rising price of precious metals, law enforcement must likely be more aware of threats similar to this robbery. Concentrations of gold, platinum and other minerals, in banks, museums and other locations will be at higher risk. Law enforcement should consider these risks in their planning in the near future.

Friday, September 28, 2012

Mineral Trade War Looms In East Asia

The Senkaku/Diaoyu Islands dispute
is a continuing source of tension
between Japan and China.
NEW SOUTH WALES, AUSTRALIA (THE AUSTRALIAN)--Due to the recent flare-up of a territory dispute between China and Japan, China is reportedly planning to halt all rare earth sales to Japan. Japanese companies are scrambling to find alternate sources, which shows in recent deals with companies like Lynas Corp and Alkane Resources. Unfortunately these sources have lower concentrations of  heavy rare earths such as dysprosium and neodymium that Japanese companies require to make everything from wind turbines to handheld electronics. In light of China's recent attempts to corner the global gold market, experts are also keeping watch on gold prices. Source: Rare earths a victim of Japan-China islands spat (Reliability: Medium)

Comment: China enacted a similar rare earth embargo on Japan in 2010, causing the price of some rare metals to more than triple. Two years later but still with few alternate sources for the heavy rare earth metals, Japan again faces potential shortages. Alkane Resources' Dubbo Project does contain heavy rare earths, but since Japanese companies will be required to process the metals in Japan it will almost certainly take a few years to develop before it significantly affects global prices.

Crossland Uranium Mine's Charley Creek Project A Potential Early Rare Earth Producer

Figure taken from Crossland website showing drill
sites in Charley Creek with a high potential TREO
NORTHERN TERRITORY, AUSTRALIA (STEEL GURU) -- Crossland Uranium Mines recently completed heavy mineral concentrate pilot test work at its Charley Creek Project in Northern Territory and the results obtained reinforce Crossland's ability to turn the project into an early low cost and long term producer of valuable rare earth oxides.  The results of the study also confirm that the Crossland can successfully concentrate the xenotime and monazite rare earth bearing minerals at Charley Creek using low cost technology commonly used in the mineral sand industry.  Crossland also identified simple flowsheet improvements to improve Total Rare Earth Oxide (TREO) recoveries during the next phase of test work. Source: Crossland Uranium Mines' Testwork Shows Charley Creek Could Be Early Rare Earths Producer (Reliability: High

Comment:  According to Steel Guru, potential buyers have already approached Crossland for output from Charley Creek, and Crossland plans to further develop xenotime and monazite concentration production.  Since the mineralization is found in alluvial deposits (free digging) Crossland can conduct mining operations at a low cost.   

ANC to potentially nationalize mineral reserves

SOUTH AFRICA (Mail & Guardian)- South Africa's governing political party, The African National Congress (ANC), has begun discussing various forms of state control of mineral reserves. According to the South African newspaper, Mail & Guardian,  members of the ANC discussed the issue, saying potentially, "state ownership, including more strategic use of existing state-owned companies, as well as strategic nationalization, where deemed appropriate on the balance of evidence." However, the ANC found that state control of 100% of mineral assets would be financially unfavorable, citing a potential cost in excess of R1-trillion. While this was deemed unfavorable, control in the form of "State-custodianship" was deemed more feasible. According to the Mail & Guardian, the ANC also recommended that the state develop strategies to identify and manage strategic minerals in the national interest. (Reliability: High)

Comment: These discussions are likely in response to the violent conflicts between striking miners and police in the last month at mining camps. The ANC also discussed the improvement of working conditions and increase of wages for workers and stated that any government policy enacted for the purpose of increase resource exploitation should "focus on benefaction".  The full congressional report can be found here: http://mg.co.za/report/2012-anc-national-policy-conference

Australia Choosing Not To Follow U.S. Lead On Conflict Minerals

MELBOURNE, AUSTRALIA (THECONVERSATION.EDU) -- The SEC brought in new legislation last month that prohibited the use of 'conflict' minerals. After setting the precedent, countries around the world are now deciding whether or not they should be following suit. Australia, however, is not one of them.
The source of much debate. Minerals mined in conflict
zones such as the DRC are funding militia groups.
The SEC recognizes the role of US companies in exploiting workers and trade of resources in the Democratic Republic of Congo and also its direct impact on funding militia groups. The SEC conflict minerals legislation aims to keep US companies accountable by making the dealings more transparent and shaming companies into not participating.
Australia, however, has huge mining interests in Africa and is not willing to follow suit. In 2011 alone, Australia had seven firms actively working in the DRC. Furthermore, Australia has more ventures in Africa than it does in any other place in the world.
Given the lack of infrastructure in the DRC, companies that do business there are expected to regulate their own behavior. It is therefore their responsibility to act accordingly in relation to the people, standards and impact that their company is having. This is not happening due to companies concentration on profits and not on ethically sourced minerals. Australia has a large stake in mining in the DRC and is unwilling to risk their enterprises by following up and implementing similar legislation to the Dodd-Frank bill.
Source: Australia Needs To Act On Conflict Minerals. (Reliability: Medium)

Comment: US businesses could be at a distinct disadvantage if the Dodd-Frank bill has the desired affect. If companies in the US withdraw or switch to conflict free sources of minerals, then Australia, and other countries that choose not to source ethically, could be at an advantage with a big supply of minerals at a lower price.

Price of Gold Soars as Investors Seek Safe Haven

Gold bullion.
People are investing more in gold because of the increased price.
AUSTRALIA (ABC NEWS) -   For most of this year, the price of gold has been around it's all time high of USD 1700 an ounce and is predicted to rise to USD 2000 in 2013.  Sources claim economic problems in the United States and Europe are causing the increase in the price of gold.  Gold is becoming a safe investment against market volatility due to the economic stimulus measures by the U.S. and Europe according to financial advisor Jordan Eliseo.  Analysts are predicting mergers and take-over bids to increase because gold miners are undervalued compared to the price of gold.  Countries are also starting to stockpile gold in order to build up their reserve currency during the tough economic times.  China in particular is a government that is known to stockpile bulk commodities and industrial related metals.  Analysts suggest this is the time to start investing in gold.       Source:  Price of Gold Soars as Investors Seek Safe Haven (Reliability: High)

Comments:  Before gold, iron ore was in the focus of Western Australia's mines.  Due to the economic times, more and more people are beginning to invest in gold instead.