Up until the mid-1960s, if you weren't a geologist, you probably have never heard of rare earth elements. Today, you can't swing a dead cellphone without hitting something that depends on them.

There are 17 rare earth elements (REE)which are all metals. Before 1965, a majority of the world's supply of REE was the result of mining in South Africa, India, and Brazil. REEs are considered the vitamins of chemistry:

They help everything perform better, and they have their unique characteristics," he says, "particularly in terms of magnetism, temperature resistance, and resistance to corrosion.

Uses of Rare Earth ElementBecause these 17 elements were hard to extract from surrounding matter, they were named 'rare earth." The name is a misnomer; the United States Geological Survey describes REE as 'moderately abundant.' Although not as common as other elements like silicon and iron, there are many locations in the world with REEs in the ground.

Writing at The Verge, James Vincent illustrates how common cerium is:

The rare earth element cerium, for example, is the 25th most abundant on Earth, making it about as common as copper. But unlike copper and similarly well-known elements, such as gold and silver, rare earths don't clump together in single-element lumps. Instead, because of their similar chemical composition (15 of the 17 rare earth elements occupy consecutive places on the periodic table), they bond freely with one another in minerals and clays.

The process of extracting REEs from other compounds takes time. Material, having been mined, is repeatedly dissolved in acids, filtered, then dissolved again. Vincent quoted rare earth trader and journalist Tim Worstall when he said, "the whole process is 'expensive, difficult, and dangerous."

REE-processing-production stages

China

Enter China. During the late 1980s, China emerged as the world's leading REE producer. China rose to the top because of the combination of two things: low-cost mining and chemical extracting methods and lax environmental restrictions. Worstall said China's biggest REE plant is an iron ore mine extracting REEs on the side. This allows the Chinese to take advantage of multiple products from a single source.

No country could compete with China's labor costs, so between 2011 and 2017, China produced about 84% of the world's supply of REE.

The match lighting the fuse resulting in an explosion of demand for REE was color television. Europium became essential for color images. The US became the leading producer of europium because the Mountain Pass Mine became the leading source of the element.

List of Rare Earth Elements

For reference, the table below lists each REE, its Atomic Number, and common uses:

  Rare Earth Elements and Their Applications
Element  Symbol  Atomic Number  Example Applications
 Light rare earth elements
Lanthanum La 57 Optical glass, nickel-metal-hydride batteries
Cerium Ce 58 Colored glass (flat-panel displays), automobile catalytic converters
Praseodymium Pr 59 Super-strong magnets, metal alloys, specialty glass, lasers
Neodymium Nd 60 Permanent magnets
Samarium Sm 62 Permanent magnets, nuclear reactor control rods, lasers
Europium Eu 63 Optical fibers, visual displays, lighting
Gadolinium Gd 64 Shielding in nuclear reactors, X-ray and magnetic resonance imaging scanning systems
 Heavy rare earth elements
Terbium Tb 65 Visual displays, fuel cells, lighting
Dysprosium Dy 66 Permanent magnets, lighting
Holmium Ho 69 Lasers, high-strength magnets, glass coloring
Erbium Er 68 Glass coloring, fiber optic cables
Thulium Tm 69 Lasers, portable X-ray machines
Ytterbium Yb 70 Stainless steel, lasers
Lutetium Lu 71 Petroleum refining
Yttrium Y 39 Metal alloys, visual displays, lasers, lighting
Source: USGS

China Flaunting Power

In 2010, China produced approximately 97% of the world's supply of REE. In September of that year, an incident between the Japanese coast guard and a Chinese fishing trawler led to the detention of the fishing captain.

China's response? They announced a stop to all REE shipments to Japan. Since Japan produces a myriad of high-tech products, they released the captain straightaway.

As a result of this incident, the US determined that China used its near-monopoly of REE as an economic weapon.

Fortunately, Eugene Gholz, an associate professor at the University of Texas at Austin, determined that China's embargo didn't damage the availability and the REE's market as initially thought.

Unfortunately for China, despite REEs' headline-grabbing role in so many high-tech industries, temporarily suspending exports cannot impose acute cost on even seemingly vulnerable targets like Japan. Why did the embargo not exact a greater cost on rare-earth dependent supply chains, either in Japan or in global markets? Why did it not manage to meaningfully deter Japan from asserting its territorial claims (beyond Tokyo's immediate, tactical decision to release the Chinese fishing boat captain)? The answer primarily traces back to three factors: increases in non-Chinese REE supplies that began well before the embargo, undermining China's supply-side leverage; administrative difficulties associated with enacting an embargo of this sort; and real-time adjustments in the market that circumvented the embargo.

In Sum

The need for REEs isn't going away anytime soon. A few years ago, an MIT study predicted that demand for one REE, Neodymium, could grow nearly 700% over the next several years. Dysprosium, also needed for wind turbines, could increase by as much as 2,600%.

In an ironic twist, as the demand for electronic devices drives their prices down, that same demand creates higher costs for REEs.

However, it's safe assuming that future advances in extraction technology increase the world's supply of REE. In the meantime, producers of our supply of REE keep working hard, making sure our world works the way it should.