Can Ucore Be the U.S. Answer to China's Monopoly?
China has a tight economic grip on us. This is because, not only for the mining of rare earths but also for their further processing, there are currently hardly any alternatives to China. With a demonstration facility for the separation of light and heavy rare earths using the latest technology, the American company Ucore Rare Metals is taking a major step to change this. In addition to China’s recently announced export ban on gallium and germanium, the possibility of restricting the export of technologies for the further processing of rare earths to the West was also hinted at.
According to the company itself, Ucore’s demonstration facility in Kingston, Ontario, is possibly the largest rare earth separation facility currently operating in North America. The critical commodities are also used in many military applications. The U.S. Department of Defense has therefore invested $4 million in the facility to verify the performance of the RapidSX-REE separation technology. According to Ucore, this represents a clean and competitive alternative to other processes. For corresponding comparative values, the facility extracts light and heavy rare earths from its source material, while simultaneously processing ores using a 52-stage conventional process. The new process separates the ores faster and uses fewer chemicals.
The goal is to commercialize the RapidSX-REE technology in multiple facilities across North America. This would also provide Europe with another option for refining rare earths. One project outside China already exists in Norway, where the currently “greenest” rare earths are produced. Malaysia also has a refinery outside China, although considerable work still needs to be done there to comply with the country’s strict environmental regulations.
In general, China’s monopoly on rare earth processing will not last forever. However, it will take significantly more time for the West to establish its own refineries than to open new mines. The U.S. and Europe can produce rare earths more cleanly than China. However, this makes the commodities approximately 20-30 percent more expensive. For investors, this creates attractive opportunities for positive returns that are also tax-free.