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China controls rare metal used in hard drives

By Patrick Thibodeau
April 19, 2010 06:00 AM ET

Computerworld - The U.S. has become almost completely dependent on China for rare earth metals, including neodymium, which is used in hard disk drive magnets, according to testimony at a congressional hearing last month.

Nearly 100% of neodymium production today is in China.

"China appears to view rare earth [metals] as one of the incentives they can offer a technology firm scouting for a new plant location," said said Rep. Brad Miller (D-N.C.), at a hearing of the U.S. House Committee on Science and Technology.

Jack Lifton, an independent consultant, said that although the U.S. has a sufficient natural supply of rare earth elements, mining them isn't profitable because the extremely low price set by China has essentially given that country a monopoly.

The major source of rare earth deposits in the U.S. was at Mountain Pass, Calif. Mining there ceased in 2002, but new owner Molycorp Minerals LLC hopes to resume operations.

One of the last U.S. companies to manufacture rare earth magnets was Magnequench Inc., which was acquired by a Chinese company in 1995 and then by Toronto-based Neo Material Technologies Inc. in 2005.

Mark Smith, CEO of Molycorp Minerals, said that "while the U.S. still possesses the technical expertise, we have lost the necessary infrastructure to manufacture the rare earth metals and magnets that fuel next-generation technologies."

This story was originally published in Computerworld's print edition. It was adapted from an earlier version that first ran on Computerworld.com.

Read more about Hardware in Computerworld's Hardware Topic Center.



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