On the floor of the Pacific Ocean, Japanese scientists discovered a 965-square-mile mud patch containing 16m tons of rare-earth metals — enough to meet global demand “on a semi-infinite basis.”
And we’re not talking gold doubloons here. This sunken treasure includes materials vital to smartphones and electric cars — and positions Japan to challenge China’s control over the rare-earth industry.
To bake up its primary exports (electronics and cars), Japan needs rare-earth metals. Lacking its own deposits, Japan has always had to go across the sea to borrow ingredients from China’s precious-metal pantry.
But in 2010, China drastically reduced its export quota for the 17 rare-earth metals — driving their price up 10x. Panicked by the price hike, Japan jumped into the ocean with a metal detector and a dream.
Scanning their “exclusive economic zone” (an oceanic area of proprietary resource rights), Japan found mud that was chock full of yttrium, europium, terbium, and dysprosium — but couldn’t use it yet.
Turns out, pouring raw mud into the hood of a Tesla isn’t enough to make it run. Japan had to extract and synthesize the precious particles, and it didn’t take long for Japanese scientists to design a “hydrocyclone separator” to separate the good from the gritty.
China, the only producer with reserves and the expensive industrial machinery to process them, has historically held the mineral market in a chokehold. Even after competition rose to meet demand, China’s market-share only slid from 93% to 86%.
Brazil, Vietnam and the Democratic Republic of the Congo have had the reserves without processing power, while the US, Japan and Western Europe have had processing capacity without reserves — until now.
Japan’s huge reserve, backed by the modern-day alchemy to process it, will end China’s virtual mineral-monopoly. After the announcement, stock prices at Japan’s largest drilling company jumped 13%.