China to start hoarding rare metals?

A disturbing report from The Telegraph suggests that China may soon cut off the world’s supply of the metals needed for many modern electronics:

A draft report by China’s Ministry of Industry and Information Technology has called for a total ban on foreign shipments of terbium, dysprosium, yttrium, thulium, and lutetium. Other metals such as neodymium, europium, cerium, and lanthanum will be restricted to a combined export quota of 35,000 tonnes a year, far below global needs.

China mines over 95pc of the world’s rare earth minerals, mostly in Inner Mongolia. The move to hoard reserves is the clearest sign to date that the global struggle for diminishing resources is shifting into a new phase. Countries may find it hard to obtain key materials at any price.[…]

New technologies have since increased the value and strategic importance of these metals, but it will take years for fresh supply to come on stream from deposits in Australia, North America, and South Africa. The rare earth family are hard to find, and harder to extract.

 Danger Room‘s Nathan Hodge comments:

[I]t’s a reminder of the role that strategic resources play, especially for the high-tech military of the United States. […]

Of course, China is not the only country that’s figuring out how to play the mineral wealth hand in geopolitics. For several years now, Russia has used natural gas supply as a way to exert less-than-subtle pressure on its neighbors. Energy, the Kremlin found, is a more effective instrument than an aging nuclear weapons stockpile: You can actually turn the gas taps off when you feel like punishing someone.

As an old piece of wisdom from Strategic Air Command put it: “When you have them by the balls, their hearts and minds will follow.”