Jon Hykawy: Mongolia should be careful with their rare earth minerals

In mid January 2012, the “Rare earth minerals: from mining to the market” forum took place in the President’s Civilian Chamber.

-What are the current supply and demand levels for rare earth minerals?

-According to our estimation, there are 16 minerals that are considered to be rare. The six radioactive rare minerals are generally in high demand. They are mostly used in glass and ceramic products, in addition to vehicles and cars. China is the country with the most rare earth mineral deposits. It is strategically important for a country to set a quota for how the amount of rare earth minerals to be exported in a year. In 2009 China exported 54 thousand tons of rare earth minerals, but this number decreased in 2011. The reason for this is that in 2011 the prices of rare earth minerals drastically decreased; the demand decreased with it too. Since car production is predicted to increase this year, there is an assumption that the demand for rare minerals will increase.

-Will China increase their mining of rare earth minerals?

-There will not be a large amount of rare earth minerals mined. This is because China is currently holding a strategy to prioritize the preservation of natural environments. As for other countries, there are talks about replacing rare earth minerals with cheaper minerals, and developed countries like Korea and Japan have already started extensive testing projects.

-What is your conclusion about Mongolia’s progress in the field of rare earth minerals?

-The mining and production of rare earth minerals is at its beginning stage in Mongolia. I think that it is crucial to aim to supply the world’s demand for rare earth minerals later if the rare mineral field is further developed. In Mongolia, there are rare minerals, which are used in making light bulbs. General Electronics (GE) is very interested in purchasing this mineral in large amounts from Mongolia. Due to GE’s interest, the mineral’s price in China fell threefold in 2011. This shows how sensitive the price of rare earth minerals are, in terms of supply and demand. In other words, Mongolia should take special care when handling rare earth elements on the market, researching more into their supply and demand.

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