Decarbinization and Defensive Readiness

 

We believe that a number of long-standing domestic critical mineral production and supply-chain concerns have moved up in importance by at least a decade. It is well documented that the United States currently imports 90-100% of many critical minerals from countries such as China. As American citizens we are sensitive to the fact that the sources and prices of these strategic commodities are largely controlled by those who do not have our environment or national best interest in mind. Following the COVID-19 challenges and related supply shortfalls, we believe there will be a longer-lasting wave of realization with regard to domestic critical mineral sourcing and their associated supply-chains. The critical minerals “issue” is something members of the Idaho Strategic team have followed for decades, and we now feel that the timing is right to add these resources to our Idaho-based resource portfolio.

The reason for our entry into critical minerals, specifically rare earth elements, is two-fold. The first reason is because it is clear to us that a low-carbon future and its associated technologies are becoming an inevitable part of every country’s individual climate plans. Technologies such as electric vehicles, wind turbines, and some solar panels all share a common denominator… a reliance on rare earth elements, which, by default, means a reliance on China. Currently, China controls approximately 95% of the world’s rare earth element production, putting the world’s climate plans, such as President Biden’s plan to have 50% of new cars sold in the U.S. be electric vehicles by 2030, nearly 100% reliant on China’s personal rare earth element production and pricing agenda1. To put it into perspective, OPEC controls roughly 41% of global oil production and they are able to significantly influence the barrel price. Meanwhile, China controls 95% of global rare earth element production giving them near total control over the supply and price of minerals critical to electric vehicles and our world’s low-carbon future2.

The second reason that we added rare earth elements to our Idaho-based resource portfolio is because of the threat to our national security that exists due to China’s dominant control of the industry. China has recently made it known that they are not afraid to “weaponize” their rare earth element production capabilities, and they have a history of doing so3. The result of any long-standing action by China regarding rare earth element controls puts the United States military in a precarious position. Everything from our defense systems and jamming equipment to our F-35 fighter jet and Virginia Class submarine uses an extensive amount of rare earth elements4. While this isn’t an issue that the United States military is unaware of, it is an issue of which there are minimal viable alternatives other than securing a domestic supply.

Furthermore, our overall business experience tells us that the opportunity for public/private partnerships with regard to strategic mineral use in future technologies, national stockpiles and mineral processing/milling is (finally) here. As a result of the tendency to celebrate the person that leads us out of a crisis as opposed to recognizing the person that kept us out of the crisis in the first place – the long-ignored decline in our country’s critical mineral readiness will not be cured overnight. As a country we cannot comfortably look toward a low-carbon future and defensive readiness without first securing and producing the strategic raw materials necessary to make it happen.

With a culmination of strategic planning, a proud sense of patriotism, and operating in the #9 ranked mining jurisdiction (Idaho) in the world; we at Idaho Strategic Resources are focused on developing a sustainable domestic source for rare earth elements5. It remains to be seen exactly what action is going to be taken toward securing our domestic supply, but with the drastic switch from oil, coal, and natural gas toward low-carbon technology; it is natural that questions around the supply of minerals, like rare earth elements, begin to be asked and analyzed. It is our early recognition and action that has allowed us to secure 2 of the top 10 domestic sources for Rare Earth Elements (Diamond Creek and Roberts) as outlined by the USGS, IGS, and DOE. We have solidified our seat at the table, and we are actively moving forward with our plans so that when the conversation begins, we are ready.

 

Links

  1. https://www.cnbc.com/2021/08/05/biden-pushes-for-evs-to-make-up-40percent-or-more-of-us-auto-sales-by-2030.html
  2. https://www.economist.com/finance-and-economics/2021/03/31/governments-have-identified-commodities-essential-to-economic-and-military-security
  3. https://www.bloomberg.com/news/articles/2019-05-29/china-gears-up-to-weaponize-rare-earths-dominance-in-trade-war
  4. https://www.forbes.com/sites/johnkoetsier/2021/09/29/us-needs-10x-more-rare-earth-metals-to-hit-bidens-electric-vehicle-goals/?sh=4fa5d5823e41
  5. https://www.fraserinstitute.org/sites/default/files/annual-survey-of-mining-companies-2020.pdf