Chines Rare Exports in October have dropped dramatically to 3 figures from around 3660 tons in September reflecting the Chinese-Japan Tensions and Export Quotas imposed by China for the 2nd half of 2010.While Japan has been frantically looking out for rare earth mineral resources in places like Mongolia,Kazakhstan,India and Vietnam,it will take around 4-5 years […]
Climate Change in the last year has faced one hit after another which should culminate in the failure of the Cancun,Mexico talks which is to start on November 29.Note there are not many expectations from the Cancun Climate Change negotiations in sharp contrast to the Copenhagen Talks in 2009.Despite the global attention and expectations from the Danish hosted Climate Meet,Copenhagen was a total disaster putting Global Warming in the Backburner despite more and more evidence of the massive global harmful effects.In the recent year,the Fossil Fuel Lobbies have been trying to discredit the very agency in charge of spearheading the war against Global Warming.They have been largely successful with global polls revealing a distinct cooling towards Global Warming Efforts.China despite huge investments into Clean Technology is emitting more Carbon Dioxide while USA has completely given up its Global Leadership on the most pressing World Problem.Here are the Reasons why the Cancun Climate Change Talks would fail.
Deflating Developed Countries are fueling Inflation in Developing Ones with ultra low interest rates.QE2 has been heavily criticized around the world due to the dangers of it creating asset bubbles in emerging markets as yield hungry investors look for growth at any price.With hundred of billions flooding emerging debt and equity markets,the situation has become volatile for a lot of countries.Brazil has already seen its currency skyrocket in the last 2-3 years due to the huge spread between its bond yields and the US interest rates.With carry investors able to make around 10%,Brazil remains a favorite market for the inflow of dollars.Other countries like Thailand,Malaysia,Indonesia have seen their stock markets rallying to all time highs as well.Many of these countries have already imposed capital controls earlier.Now they are increasing further,as monetary authorities rush to close the gates.
Toyota is a Leader in Hybrid Vehicles with its iconic Prius the biggest selling Hybrid Car by Far.Toyota has been cautious about the growing rush into the Electric Vehicle Category.It has tied up with the much hyped up US Startup Tesla to introduce an EV RAV4,however its concentrating its energies on the Hybrid Car Market.Note another Japanese Automajor Honda is putting its bet on the Hybrid Segment of the Green Vehicle Market.The Economics of the Electric Vehicle Market as well as its Carbon Footprint is suspect despite all the media hoopla being created around it.While the Competition has increased substantially around both the EV market and its allied Battery Sector,the profits are far off.Hitachi has forecast losses for the next 2-3 years as China and USA compete to create national champions in the EV sector with Obama aiming for a 40% global marketshare .
USA is the 2nd largest importer of REE and it has thought of taking the issue to WTO.But the WTO has proved to be quite toothless delaying the hearing of issue till 2011.Obama has decided to rake up the REE shortage in the G-20 meeting even as US Senate thinks of passing legislation to boost domestic sources of REE.Molycorp was up more than 11% forming yet another lifetime high on the news.Note the US Congress has already passed a REE law and the Senate needs to endorse the draft in order for it to become law.Rare Earth Elements have a Defense Angle to them as well as many of the REE such as samarium are used in Defense Products.Radars,Pathfinders,Smart Bombs and a number of hitech weaponry require Rare Elements for their production.Without a domestic source,USA might be put at a serious disadvantage in the coming decades.
Chinese Monopoly over Rare Earth Elements has Foreign Governments worried
Rare Earth Elements (REE) have become a hot media top with the unofficial Chinese export embargo to Japan.REEs are crucial raw materials for a wide range of industries in the Green and Defense Sectors.The Chinese monopoly over the production and supply of these commodities have made EU and USA thinking of taking the WTO route.However this had not detered China from clamping down on the production and exports.China wants to use these minerals as a strategic resource to force Green companies to relocate to China and transfer hard to get technologies to local Chinese companies.Note while EU and USA are looking to export Green Product to China,the government there has shrewdly only given permissions to companies willing to transfer technology.
Can India take Advantage to become a Leading Supplier
Rare Earth Element Deposits are found in many places in the world but due the Chinese undercutting of prices and lax environmental regulations had all but shuttered every mine in the non-Chinese geographies.Recent Chinese moves have opened up oppurtunities for REE mines as prices have increased by almsot 5-10x in the last few months.Lynas Corp is opening up a mine in Australia while Molycorp is reopening its mine in Mountain Pass,Californa.India also has a long history of production and export of REE . However its production of around 2500 tons is only 2% of the estimated Chinese yearly production of 130,000 tons.