Northern Minerals boss George Bauk leads politicians around the company's rare earths plant. (Supplied: Northern Minerals)
China's threatening to restrict the metals that power our phones – here's what might happen
Storm clouds from Donald Trump's trade with China could see the sun rise on a new industry for Australia.
- Rare earths are a group of 17 minerals vital for electronics – from wind farms to vacuum cleaners, mobile phones to fighter jets
- China holds about 40pc of the world's rare earth reserves and controls about 90pc of production
- Experts say Australia could build a $ 100 billion industry in mining, processing and manufacturing with rare earths
In the tit-for-tat trade, China has made threats to withhold access to its processed rare earths.
That's it! The iPhones to Fighter Jets.
Processing rare earths is expensive and polluting so, up to now, it has been happy to send offshore.
But the history of relying on China has now become nervous.
Miner Northern Minerals is piloting facilities in Western Australia to not only dig up rare earths ore for export, but to partially process it.
Northern Minerals managing director George Bauk told The Business, "There's no question we need to act fast and as much as possible."
The Western Australian Miner is piloting facilities at its Browns Range Project, south-east of Halls Creek, to separate dysprosium from its surrounding ores.
Northern Minerals has planned a separate dysprosium from its surrounding ores. (Supplied: Northern Minerals)
Mr Bauk said the world has a "broken supply chain" to develop out of China.
"We really have to get away with rare earths and that way you can access global markets, not just China," he said.
The world's second-largest economy has about 40 per cent of global rare earth reserves and controls 90 per cent of the market, from mining through to processing.
It is also a major player in the supply chain, manufacturing items as rare earth magnets, which are vital in technology including electric vehicles.
Nic Earner, the managing director of New South Wales miner Alkane Resources, said that dominance means China also controls prices.
"People who control the supply chain control the pricing," he said.
"We want to have little exposure for as a company to that.
"We're not happy to be part of a global market, but we're not happy with that."
Alkane Resources is focusing its attention on rare earth production at its Dubbo project.
Alkane Resources, based in NSW's central-west region, has invested more than $ 1 million in rare earths separation technology development. (Supplied: Alkanes Resources)
It has recently invested more than $ 1 million to develop technology.
Earlier said. "This is a further value that we are hoping to entice.
"It wants to make metal and that's important step in the supply chain."
Developing the rare earth supply chain in Australia could be a massive boon to the economy.
Professor Dudley Kingsnorth is one of the world's leading minds when it comes to rare earths.
He said Australia is already $ 3 billion to $ 5 billion worth of raw rare earths production.
However, he argues that doing more than just digging up the dirt could have been a lot larger in the economy.
"$ 100 billion was what it could have been in Australia, but that would take 10 to 15 years to do," he said.
"But that's the sort of value we're talking about."
The raw rare earths – means it means final production products that use the materials.
"In five to seven years we should be producing here in Australia and incorporating them in the manufacture of some equipment that is here in Australia as well," he said.
90 per cent to 70 per cent. "" China is going to stay the dominant supplier. "
Chris Vernon at the CSIRO has been looking into too.
Dr. Chris Vernon is the program director responsible for the CSIRO's extractive metallurgy research program. (Supplied: CSIRO)
"If Australia could develop the rare earths industry, then we could make much more money out of what we currently export as a raw concentrate," he said.
"Any time you go up the value chain, you are creating value.
Going from the concentrate to the mixed oxide, that's another leap up the chain.
"When you start making magnet metals, that's a very big leap up the value chain."
New manufacturing sector
While a renaissance in the car manufacturing industry is unlikely, smaller items using rare earths, like vacuum cleaners and air conditioners, could end up being manufactured here too.
"We can not go as far as perhaps attracting the automotive industry here, but I dont like attracting attention," said Professor Kingsnorth.
That is a huge potential for new industry for Australia.
"There's almost nothing you can do in your hand that's a piece of technology that does not have some rare earths," Dr Vernon said.
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