Complete Chinese state control of a market that has a near monopoly on rare earths.
What if these tariff wars escalate, due to EU and US EV tariffs?
What if the China/Taiwan tension escalates?
What if relations between the west and China degrade rapidly?
China have weaponised commodities before.
They have used tariffs to devastating effect.
They did momentarily ban exports of rare earths to Japan back in 2010, which was a world wide wake up call.
They have previously threatened the US with the same.
But again the west falls asleep, subdued by a sweet Chinese lullaby of plentiful supply and cheap pricing.
The western supply chain should have properly decoupled 10 years ago....but it hasn't...not even close
And again last year, China banning any rare earth tech or IP to leave China.
So what if they want to respond to 100% tariffs imposed in the US?
Are rare earths part of their strategy?
No one can deny, this is massive leverage.
Who will the west turn to ?
Lynas...MP???? Forget it, they refine in China. Lynas plans on a couple of heavies, dysprosium and terbium, to come out of Malaysia next year, and Texas is still a way off.. But they always get bent over a barrell, everytime their radioacyive riddled products come up for renewal in Malaysia. And what if China leans on them as well?
The quickest, safest, cleanest, greenest is recycling, and I am not specifically talking about Ionic Tech. Forget about mines and permitting and years of studies and massive capital etc....
You need recycling...proven tech that can be expanded and be modular...with links and partnership with alloy and magnet makers...sound familiar?
It would take all of the recyclers combined, to try and fill that void, and I still don't think we would come close.
An extreme case...yes, but very plausible and not outside the realm of possibility.
There wouldn't be a militarised government or military contractor on the planet (outside of China and its allies), who would be comfortable with this latest change in policy and the realisation that the now state controlled tap, could be turned off at will.
China halts exports to Japan....China threatens US with rare earth ban...China bans exporting Rare earth tech and IP....and now China to take full state control of rare earths, which are now considered state owned....what is next??
Rare earths belong to the country and no organization or individual are allowed to claim them, the State Council said in a statement on its website. The state will take charge of protective mining of the resource, it said. The new rules take effect on Oct. 1. Government agencies will have control over the total amount of rare-earth mining and smelting, and will establish a product traceability system, it added. The regulation also stated penalties for illegal activities involving the mineral’s output.
In the absence of an eloquent alternative saying, this shiX just got real...very real...
Because what we are witnessing, and hopefully what the western powers are realising, that price is no longer the governing factor in this equation.
SECURITY OF SUPPLY, is.
In my view, it is paramount and trumps everything.
Most definitely in the defence space, and more broadly in the EV space.
China- 'Hey US/EU, You want to tariff and hurt my EV sales? Well good luck GM, Ford, VW, Stellantis etc....on getting magnets for your motors....we are not letting you ruin our multi decade and US$231 Billion investment....touche Gweilo'
Make no mistake, all these years, these decades of developing tech, monopolising commodities and their refining...lithium, nickel, cobalt and rare earths....battery development and technology and finally EV cars which are ahead of the west.......ALL OF IT.... has been for the ultimate goal of the Chinese....... complete domination of the world wide auto industry.
And they are prepared to do anything to defend it.
I would hope, that this turn of events is now the impetus the west needs, to finally get the cheque books out...and I mean REALLY get the cash flowing, and start funding projects like ours, to be built out and producing asap.
And if our guys happen to be in the UK, and meet with the new Labour government next week, I would be ramming this down their throats as hard as possible....
And the same with the French, the Italians and the Germans.........and eventually the US/Canada.
Time for the guys to start nailing some deals....and hopefully this latest turn of events and hard line Chinese policy change, is the leverage they have needed all along.
Thank you China!
IXR Price at posting:
1.0¢ Sentiment: Buy Disclosure: Held
(20min delay)