IXR (ASX) General Chat / Discussion

Originally posted by SilverSand: ↑

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MP Materials: Ruined by Tariffs; White House RE Second Guessing; Saudi Arabia's Green Horses; RE Magnets: Where is the Data?; Unusual NdFeB Project in Baotou; Denial of Gravity: Solvay & Carester;
Rare Earth 18 April 2025 #173
Apr 18

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Another chapter in the tariff drama
The U.S. administration, true to Wild-Westshoot first, ask questions later,applied a maximum possible punishment for failed trade negotiations before any negotiations have even taken place.
In terms of trade this is a nuclear first strike. For the current 90 days it is largely limited to China, while U.S. import cost rise 10% flat for all other countries -except for the U.S. long-term arch enemy: Russia.
As in a nuclear war, also in terms of tradeRand Corporation’s “MAD”applies here:MutuallyAssuredDestruction.
It seems to be slowly dawning on politicians in the U.S. what destructive forces the current U.S. administration has unleashed on both sides of the Pacific Ocean.
Capitol Hill BBQ
Trade Representative Greer tried hard to defend the indefensible on Capitol Hill, and we sat through the entire length of the relentless bipartisan grilling of Greer by both houses. It appears that Greer is of good character and one could reasonably expect him to resign. But that would probably end his career, as neither of the two flavours of the U.S. political system would ever forgive him.
The exception list
Looking at the items on the“reciprocal” tariff exception listit would appear that the U.S. want what China no longer wants to give to U.S. defense industrues.
In terms of rare earth the“reciprocal” tariff listcontains this:

It is not only rare earth, rare metals are also on the list. For example:

RE magnets not on the exclusion list
Notably absent from the reciprocal tariff list are rare earth permanent magnets and thereby these are subject to trade war tariffs.
While in general a step in the right direction, it is excessive and destructive to U.S. domestic industry, as there is absolutely no chance at all to replace 7,445 t (2024) of rare earth permanent magnets from China by domestic production in the near or medium term.
More impact questions
A global news network asked us, what impact we would expect on U.S. industry from China potentially withholding all rare earth dual-use products. We simply could not visualise a wholesale embargo for its sheer magnitude of impact.
U.S. defense contractors dead in the water
However, China has warned before that it does not wish to aid the production of weapons that can threaten China. It has put a number of U.S. defense contractors on itsdo-no-businessentity list. Export licenses for product destined to other U.S. defense contractors are also not going to happen.
Different from the current U.S. administration changing course according to the direction the wind is blowing, China's dual-use measures are edged in stone and no trade negotiation is going to make them go away. The U.S. defense industry now must develop its own rare earth resources.
Capability for production of the default defense magnet exists, samarium-cobalt. But the samarium for U.S. defense contractors has just gone missing.
In terms of NdFeB magnets, defense consumption of which still is rather low but foreseeably substantially increasing, all hopes must be pinned on the eVAC project, the only one with the sophistication and know-how required for this mission-critical task.
One must keep in mind, that VAC are substantially China-dependent not only on heavy rare earth metals(even if it is Chinese rare earths processed in the UK),but also for the rest of its operations, incl. the JV with China’s so-far biggest NdFeB manufacturer.
Hectic activity in the White House
It probably just dawned on the current U.S. administration what afabulous complete pig’s breakfastit has just served-up.
More in the whole article, basically it's chaos from my take on this.

Anyone see it differently?
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100% agree.

There is a mad scramble at the moment as RE's are turned off by China, and the wests solutions are years away.

Refining is not only basically non existent, they don't have the tech, the expertise or the people or the equipment to begin full scale refining production.

I would imagine if the DOD said to Tim and Brett, here's Us$200M for a recycling plant....., on the condition you had to build it in under 12 months, they probably could.

Concurrently, you could build an inventory of spent magnets, and partnerships with US magnet makers

Big dollars can move mountains, and move them quickly.

No BS, no fluffing around, just get stuck in.

And I don't think this is fantasy anymore...in this mad scramble for supply, something has to give.

I have said it again and again...SECURITY OF SUPPLY, SECURITY OF SUPPLY, SECURITY OF SUPPLY...and I will keep stating this....because this is now well and truely the situation the west finds itself in, particularly the US.

And security of supply is PRICELESS.

Their defence contractors could be dead in the water if they don't.

I would even be lobbying GD, Boeing, Raytheon, Lockheed Martin etc....directly.

We know the direness of the situation, and the analysts can as well.

And if we can all see this, you better believe the DOD is all over it.
To be honest, they have had studies and reports and papers commissioned that have been telling this since around 2010.

Yet nothing tangible...

But now they are finally FORCED to act...there is no alternative.

Lucky the boys will be there in Washington next week.

We are our own supply chain....We are the solution...

Sell the solution...sell it hard and make them see...make them believe.

Let us see what this trip brings....

BTW, Interesting clip below-

https://youtu.be/rv8yostPnwU?si=2JP94-U0uT3usVqJ