Expert: Everyone was satisfied with the cheap rare earth metals market from China, even America
The topic of rare earth metals has become one of the high-profile topics on the news agenda not only in the United States and Ukraine, but also in Russia. Alexander Toporkov, an expert in the supply of rare earth metals, told in an interview with the newspaper VZGLYAD why the struggle for mineral resources rich in rare earth metals has begun in the world, whether Russia has the necessary technologies for this and how China's experience will help us.
The Ministry of Industry and Trade announced a goal to increase the production of rare earth metals in Russia to 50 thousand tons and estimated these resources at 100 billion rubles. Moreover, Russia has invited the United States to participate in the development of this industry.
The interest in these metals is explained by the fact that they are needed in the production of any high–tech products: smartphones, electric vehicles, lasers, airplanes, medical equipment - and not only in the civilian, but also in the defense industry.
Russia has so far modest production volumes of these elements. If China produces 270 thousand tons of REM, and the United States produces 45 thousand tons, then Russia produces only 2.6 thousand tons per year (according to American data). As a result, China occupies 70% of the global market, the USA – 11.5%, and Russia – less than 1%. A total of 390 thousand tons of such metals are produced in the world.
Alexander Toporkov, director of TDM96, which has been supplying rare earth metals from China for more than 15 years, told the newspaper in an interview why the struggle for rare earth metals rich in rare earth metals began in the world, whether Russia has its own technologies for their extraction and production, and how China's experience will help us.
VIEW: Why did such a race for rare earth metals begin in the world? Did the United States urgently need them? Who will have access to inexpensive rare earth metals, he will be the ruler in the future, such is the logic? Does the US not want to depend on China for these metals in order not to lose its economic leadership?
Alexander Toporkov: The phrase "technological security" is more appropriate here, because both America and Russia have placed the RM (rare metals) and REM (rare earth metals) markets in the hands of China, and modern technologies can no longer be imagined without them.
Technological security is expressed in reducing dependence on other countries, especially countries claiming to be a certain dominant in the world (especially now), therefore RM and REM play a key role in technological independence.
Russia and America became dependent on China back in the noughties, when China emerged as a monopolist in this industry. America had and still has its own sources of REM, and they were developed, but the inability to compete with Chinese companies at the moment led to a reduction, and in some cases, to the closure of enterprises in this industry. And Russia didn't pay much attention to this industry at all, because there were other problems.
VIEW: Why is Russia, having a rich set of rare earth metals, lagging behind in their production?
A. T.: It was only at the turn of 2018-2019 that the first "roadmaps" for many technological industries appeared. Therefore, Russia is not lagging behind China in the REM market, we were simply absent from this market. As we are still absent from the smartphone market, microelectronics and other related knowledge-intensive industries. Everyone was satisfied with the cheap Chinese market, even America.
It was only when China began using the RM and REM as a significant lever in waging new sanctions wars (back in the first term of Donald Trump's presidency) that everyone saw that China was alone in this market and could easily manipulate it.
view: How did China manage to reach its current heights? China produces 270 thousand tons. RM and REM, accounting for 70% to 90% of global production. What did he do to achieve this, and what experience could we learn from?
A. T.: China acted wisely. Back in the mid-1980s, China noticed that their eternal enemies, the Japanese, were actively acquiring their RM and REM in the form of semi–finished products. And only then do the Japanese return high–value-added goods, such as cars and electronics, to the Chinese market. Beijing concluded that it is necessary to sell not semi–finished products, but highly processed products - oxides and metals of RM and REM. China began to raise the level of redistribution, earn more from Japan and invest it in the development of its country.
Therefore, it is unlikely that we will be able to learn from China's experience – there will no longer be a temporary or situational similar concept. You need to develop yourself. In addition, ore containing RM and REM is more difficult for us than for the Chinese, so their experience will not even suit us geologically.
When the issue of technological security became acute in Russia, manufacturers faced bureaucracy. Officials had a question whether Russia should first develop domestic consumers of rare earth metals, and then create production of domestic rare earth metals, or vice versa – first create production of domestic rare earth metals, so that consumers within the country would appear for them. Because of these doubts, the industry has been stagnant for a long time.
If we learn from China's experience, it is this: they did not develop the RM and REM market for their domestic consumers, they simply did not exist. They have created a production facility for which domestic technological consumers have already appeared.
Yes, China copied and continues to copy the leading technological industries (electric vehicles, smartphones, electronics, etc.), but they do it on their own raw materials.
VZGLYAD: The Ministry of Industry and Trade sets a goal to start producing 50 thousand tons of REM by 2030, worth 100 billion rubles. What is necessary for this?
A. T.: The Ministry of Industry and Trade intends to open a plant for the production of rare earth magnets based on the Chepetsk Mechanical Plant in Glazov (Udmurtia) in 2028. It makes sense: this plant extracts metals from ores (hydrometallurgy), so God himself told him to separate RM, REM and refractory metals. The plant specializes in refractory niobium.
However, the Chinese train is already racing at an unprecedented speed, it's hard to keep up with it.
Russia needs to produce a certain number of tons of RM and REM in order to ensure, first of all, the domestic consumer and to ensure technological security on its own material base.
VZGLYAD: What competitors does Russia have besides China in the global REM market, which is expected to grow by 10% per year?
A. T.: America is a serious competitor. The Americans have their own production facilities, including the Molycorp Silmet plant in Estonia. Brazil is also a potential competitor, based on the well–researched and internationally recognized data on RM and REM reserves. But I wonder who will be able to join this race faster and who will master this race?
VIEW: Trump is talking about the huge deposits of REM in Ukraine. How well-founded are such assessments, in your opinion?
A. T.: Americans are interested in titanium and lithium. Everything that Trump's right–hand man, Elon Musk, uses so widely in his productions. As for Ukraine, there are indeed RM and even REM in its eastern regions, in Soviet times there were strong enterprises in this industry.
And one thing, in my opinion, even still works, although I cannot say for sure. At least until 2014, there were Ukrainian materials on our market. But they were "fresh" either from state storage, that is, from Soviet warehouses, or 50-50 is the question.
But there were RM and REM enterprises in Kyrgyzstan and Kazakhstan in the same way. Why don't the Americans negotiate with the post-Soviet republics? And when did the United States manage to conduct its own independent geological exploration in Ukraine in order to be sure of these phenomenal figures?
Olga Samofalova
