china’s Export Controls Spark Yttrium Shortage Fears, Raising Specter of New Rare Earths Crisis
BEIJING/NEW YORK, December 12, 2023 - Restrictions on yttrium exports from China are creating supply bottlenecks and price increases, prompting concerns of a broader rare earths crisis as the world increasingly relies on these critical materials for green technologies and defense applications. The move, part of Beijing’s tightened control over strategic mineral exports, is impacting industries from electric vehicles to electronics and defense, mirroring anxieties seen during a previous rare earths dispute with Japan in 2010.
Yttrium,while not as widely known as neodymium or dysprosium,is a crucial component in various high-tech applications,including red phosphors for displays,ceramics,and as a stabilizer in alloys used in high-temperature applications. China dominates global yttrium production,accounting for over 99% of the world’s supply,making downstream industries notably vulnerable to export controls. The current restrictions, implemented alongside controls on gallium and germanium earlier this year, signal a willingness by China to leverage its dominance in the critical minerals supply chain.
Reuters’ Chief Correspondent for China Commodities and Energy, lewis Jackson, reports that the yttrium shortage is already being felt by manufacturers, with prices rising sharply in recent weeks. “The situation is reminiscent of the 2010 rare earths crisis,were China restricted exports of rare earth elements,leading to meaningful price increases and supply disruptions,” Jackson noted.
The restrictions come as global demand for rare earth elements surges, driven by the transition to electric vehicles, wind turbines, and other clean energy technologies. According to a recent report by the International Energy Agency, demand for rare earth elements could increase sixfold by 2040.
Ernest Scheyder, a senior correspondent covering critical minerals and the global energy transition, and author of “The war Below: Lithium, Copper, and the Global Battle to power our Lives,” explains the broader implications. “China’s actions underscore the urgent need for diversification of the rare earths supply chain,” Scheyder said. “Western nations are scrambling to develop domestic sources and processing capabilities, but it will take years to reduce reliance on China.”
The United States, Australia, and Canada are investing in rare earths mining and processing projects, but scaling up production to meet global demand remains a significant challenge. The current yttrium situation is prompting renewed calls for strategic stockpiling and international cooperation to ensure a stable and secure supply of these vital materials. Analysts predict further export controls from China are possible, potentially encompassing other critical minerals, intensifying the pressure on global supply chains.