Reuters reported that Russia with as much as a third of the world's rare earth deposits will take at least a decade to develop them and step into the breach that has been created since China chopped supply of the metals to the rest of the world.
China controls about 95% of the market for the 17 elements in demand by manufacturers of everything from hybrid autos to wind power stations and has cut its export quota by about 40% in the past two years, sending prices soaring.
Australian and US firms have been quick to launch new mines and restart mothballed operations with projects scheduled to go online as early as the end of this year. Russian deposits, while ranked third-largest globally are largely undeveloped. Output remains limited to one Soviet era plant in the Murmansk region.
Mr Jack Lifton founder of the industry consultancy Technology Metals Research said that “I would say if they start now you would see that at the end of this decade they could be producing. We are not looking for production to happen anytime soon.”
Estimates of the size of Russia's deposits vary widely with local geologists putting its share of the planet's supply at almost 30% while the US Geological Survey has reported that Russia and its former Soviet neighbors hold 19 million tonnes of reserves, or about 14% of the total.
Mr Rod Eggert Colorado School of Mines professor of mineral economics said that “I think Russia certainly has potential. It has a number of rare earth occurrences. However, they have not been converted into reserves. The reserves are known to exist with a high degree of certainty and also commercially feasible to extract.
German industry is eager to tap Russia's resources. During a visit to Hanover in July, President Mr Dmitry Medvedev said his country could become a key supplier to Europe's largest economy.
Mr Alexander Rahr of Germany's Council on Foreign Relations said that the Federation of German Industry has since set up a research center on the issue, though no deals have been signed. Japanese trading house Sumitomo Corp's Kazakh joint-venture SARECO is also considering possible projects in Yakutia, a remote autonomous republic in the Russian Far East.
(Sourced from Reuters)
