Why the Swedish treasure is so important

They are called neodymium, praseodymium, cerium or dysprosium and are essential for tomorrow’s economy: the rare earths are a series of elements that are necessary for the production of wind turbine generators or electric cars, for example. By far the largest part of the global production volume comes from China. On Thursday, Swedish state mining company LKAB reported the discovery of the largest known deposit in Europe near Kiruna.

A total of 17 elements belong to the rare earth elements. The properties of the individual metals differ. The 17 elements are summarized under the collective name because they often occur together. Each of these metals has properties that make it valuable to the industry. Some are irreplaceable.

For example, Europium is used for television screens, cerium for glass polishing and lanthanum for catalytic converters in gasoline engines. Magnets for offshore wind turbines are made from neodymium and dysprosium. Rare earth metals can also be found in drones, hard drives, electric motors, telescope lenses, missiles or fighter jets.

no In principle, most rare earth elements are relatively common in the earth’s crust and there are also large deposits in Germany in northern Saxony. Before the discovery of Sweden’s estimated stockpile of 1 million tons was announced, global reserves were estimated at 120 million tons, with more than a third in China.

Researchers also assume that there are other deposits that are not yet known. The decisive question, however, is whether the extraction is economically worthwhile – because the effort and subsequent costs for the environment are high.

Rare earth metals are usually found in compounds in ore deposits. It is problematic to extract the rare earths in the purest form from the mined ore, which often requires chemical processes with acids. The processes are complex and have numerous side effects: radioactive isotopes and toxic wastewater are created; the areas around the production areas often resemble lunar landscapes. According to experts, the promotion of rare earths in Germany is not possible for environmental reasons.

According to the Swedish mining group LKAB, the road to possible extraction of the metals is long. The first step is to apply for a decommissioning permit. The intention is to submit a corresponding application later this year. Given other approval processes in the industry, it will likely be at least ten to fifteen years before mining can actually begin and raw materials can be brought to market.

China is by far the world market leader for rare earths. The country itself has large deposits, but its leadership is largely “the result of a longstanding industrial policy,” said Jane Nakano, a researcher at the International Center for Strategic Studies (CSIS) in Washington. Beijing has maintained a large network for refining raw materials through massive government investment over the years, which is why many rare earth producers are now exporting them to China.

Another important point is a “delayed regulation of the commodities industry,” says Nakano. Beijing also bought its dominance of rare earths with the high environmental costs of its own production.

Beijing first openly used the metals as leverage in 2010: the government suspended exports to Japan over a territorial dispute. In 2019, the United States faced a similar threat in the context of trade disputes with China. Rare earths are a pain point for US industry. The US itself dominated the world market for years, but is now also heavily dependent on imports.

Japan has now diversified its supply chains and relies on rare earths from Malaysia and recycling, among other things. This is what the EU wants to do with Beijing against the background of numerous trade and geopolitical differences. The mineable deposit in Sweden is very useful. In general, the European Commission of Ursula von der Leyen (64) wants to propose measures this spring to strengthen Europe’s strategic autonomy in the field of critical raw materials.

Another argument is that without this autonomy no ecological and digital change can take place. For important batteries, people are 100 percent dependent on imports, said the Swedish Minister of Energy and Economy Ebba Busch (35). We await the Commission’s proposals with great anticipation.