Advanced Magnet Manufacturing Begins in the United States
spectrum.ieee.org
spectrum.ieee.org
MP Minerals operates the Mountain Pass, CA rare earths mine. This was the largest rare earths mine in the world at one time. After several shutdowns and two bankruptcies due to low rare earth prices, MP Minerals bought the mine in 2017 and had it producing ore in 2020. The mine already had a "beneficiation" plant, where raw ore goes in and a mix of rare earth elements, plus lots of unwanted tailings, come out. Unlike the plants in China, they have a process that doesn't require huge settlement ponds and vast amounts of water, so it doesn't create too much of a mess. It's mostly a mechanical process, and processes huge volumes of ore, yielding a much smaller volume of concentrate.
What comes out of the benficiation plant needs more separation. That had to be sent to China to be refined, because there were no plants to do the separation in the US. So MP Minerals got the US Department of Defense to fund a separation plant at Mountain Pass. This separates the different rare earths. It's mostly a chemical process. Again, what comes out is a lot less volume than goes in. The Mountain Pass separation plant has been working for a few years now.
What comes out of the separation plant needs more purification and alloying. That's what the new plant in Texas does. That's a modest sized facility in an industrial park. What comes out is metal ready to be formed into magnets. That completes the supply chain.
Owning the whole supply chain insulates MP Minerals from trouble in the middle stages. Such as China's 2024 ban on export of rare earth processing technology.[1] Now that they have the whole supply chain working, they can increase production if desired. It's much easier to duplicate a plant than make a new one for a new process.
[1] https://www.csis.org/analysis/what-chinas-ban-rare-earths-pr...
It's important to contextualise this, it is probably the most important part of the entire story. Rare earths aren't all that rare, they generally have a crustal abundance comparable to copper. The question of where rare earth mining & processing happens is mainly one of price. Or, accounting for second order effects, a question of environmental regulations.
I’ve done consulting work at a giant open pit copper mine the size of which cannot be described, sitting idle waiting for the price of cooper to climb above a benchmark.
I'm all for a country subsidizing food to ensure sufficient domestic production but I am not for pretending it's good for a "price stability" reason.
We are also well beyond sufficient domestic production. Our population has doubled in the past 50 years [1] while food production has tripled. We do not need agriculture subsides for sufficient domestic production.
[1]: https://www.census.gov/data/tables/time-series/dec/popchange...
[2]: https://www.usda.gov/about-usda/news/blog/look-agricultural-...
Price stability itself is a valid goal. Yes, consumers may pay a liiiitle more for their eggs, milk or bread, but the price of the good can be relied upon which is very important for low-income households and their financial planning.
My understanding of the situation was that low income shoppers are typically extremely keen for a bargain and are quite happy to shop around. And on paper they can just pretend the price is higher than it really is if stability matters that much to their planning.
> very important for low-income households and their financial planning.
Paying more is beneficial for low income households, I see. That looks like expert level mental gymnastics detached from the reality.
Bro, I literally used to be homeless for a while many years ago. Believe me, I know how reality looks like, and there was nothing more frustrating than finding out, whoops, you don't have the 20 fucking cents to buy the groceries you wanted because they decided to raise the price of butter over night. Price reductions are announced in ads all the time, but price hikes? You can only find that out when you are in the store but then it may be too late and you gotta reschedule what you buy at a moment's notice.
Grocery prices must be stable and not subject to arbitrary games.
I don't want to thoughtlessly minimise feeling bad, but between (having more food), (shelter) and (feeling good), society would be doing better to prioritise in that order when it comes to trying to help. We're talking about a situation where you have 20 cents; a 2% average reduction in the price of butter means you get around 2% more butter and associated calories. If we trade off price increases for higher average prices you'd literally just have had less butter to eat. Those differences will add up over a month, even if sometimes there is a tough shopping trip.
If the price stability thing is for poor families there are many better policies than pushing up the average price of food. Like pushing the price of food down, then finding ways to communicate what is cheapest this week. Ie, solving the "You can only find that out when you are in the store" part.
Depends on how it works. There are a few different cases.
One is for a commodity where increased supply and lower cost does not increase demand much. Rare earths are like that. The cost of the metal is a small part of the cost of the finished product. A drop in rare earth prices will not increase motor sales much. So overproduction from multiple sources will crash the price. This is why commodity prices are so volatile, despite relatively constant supply and demand. A slight imbalance in supply and demand produces huge price changes.
Here's the historical price of copper.[1] The price has varied over a 4x range in the last 15 years. 2x in the last 5 years.
Futures trading can help stabilize prices, but too much futures trading relative to the actual commodity can increase volatility.
Only for domestic consumers. Foreign consumers? Not so much. A ton of the EU's excess butter and milk products for example ended up being donated to Africa and ruined local agriculture there that couldn't compete with free products.
A similar story is playing out in Gaza where there hasn't ever been any incentive to build out domestic production of food because UNRWA brought in a loooot of food aid (which on top of that got looted and commercially re-sold by Hamas).
Excess production is vital for any country, but it has to be kept at a moderate level and especially it must not be donated off in a way that threatens domestic production of the good in question.
Owning the whole supply chain is a win because the price of magnet-ready alloy fluctuates less than the price of dirt with some rare earths mixed in.
[1] https://www.forbes.com/sites/timtreadgold/2015/05/15/chinese...
Are there any other contenders or did this come with any guarantees of this yet another example of oneside public-private partnerships?
MP Minerals was mining ore and shipping beneficiated ore to China for further refining. So it made sense from a DoD national security perspective to fund on site refining in California. DoD only funded one of the four steps from mine to magnets.
[1] https://cowboystatedaily.com/2024/02/07/rare-earths-discover...
[1] https://www.counterpunch.org/2006/04/07/the-saga-of-magneque...
Would they have been able to hit a competitive price while maintaining environmental regs and paying a domestic workforce, would china end up the only other supplier in the world? Can government subsidies be counted on to last multiple administrations?
Keeping the retail prices the same whilst more-than-decimating the manufacturing cost? How could it not be obvious that anyone and everyone would follow once there was a proof of concept.
When capitalism is measured on incredibly short term performance, with no consideration of long term sustainability or national interest or maintenance of national skills and capabilities. This has been going on since well before the world wide web became accessible to most Western households.
Nike started doing it in the 70s and they weren't the first.
I've long been confused* to why there was no legislation to prevent "local" companies from giving away the keys to their kingdoms to foreign countries.
*Not really, politicians are just as short-term motivated as business owners.
It made sense. But the chickens are now coming home to roost, and they're shitting all over the place and the unprecedented profits have been spent on fancy plastic toys (that are now mostly landfill) instead of any kind of preparation for the inevitable tsunami of chicken shit.
>*Not really, politicians are just as short-term motivated as business owners.
Voters also like lower prices today in exchange for higher volatility tomorrow. No one was forced to shop at national businesses rather than local businesses, but people like the lower prices of larger businesses.
That model may have worked hundreds of years ago when comparing horseshoes made by local blacksmiths, and possibly still held up when comparing mousetraps made in the same state / country. But it has issues when applied globally, and we have not adopted fast enough.
Clearly that isn’t actually why and it’s all the fault of (checks notes) illegal immigrants. I’ll warm up the military transports right now!
For a long time this seemed like an exceptionally good deal for the US.
Other countries dig up their rare natural resources, send them to us, and in exchange we send them intangible products like Microsoft Office licenses? That's a great deal. You're literally getting something for nothing.
Other countries' workers make refrigerators for us, sell them to us really cheaply, then they also send a load of the profits back to us because they licensed an American-owned design and brand? You cannot lose.
Meanwhile, supposedly the skilled, high-added-value manufacturing would stay in the West with our educated workforce. And to top it all off, this was supposedly making the poor countries less poor and more democratic as you can't trade without free-flowing communication and a prosperous middle class.
Of course in practice this has gone badly in the long term. The current generations are certainly feeling the consequences. But for the previous generations? They got the highest standard of living in the world!
People forget that the flipside of keeping manufacturing in America is that it would have denied the ability for the global poor to rise up. And they should, they deserve that right too. What the neoliberals underestimated was the extent of how nationalistic these rising countries could become, as they instead not to transition but to instead keep on their low end manufacturing while simultaneously competing in the high end. Namely, it wasn't about improving the lives of their citizens, it was about achieving total control over the supply chain.
The sad part of this situation is that for all the global south cheers the "decline of the west", with the closing of the American market and the utter dominance of China, the economic ladders up may have been forever broken.
Yeah that was totally unprecedented.. If you ignore examples of exactly that happening at other times in history, like Japan. They went from a very poor feudal society where most people lived as peasants society to an industrial society able to seriously challenge America in less than a century. Violent rabid nationalism came with and facilitated that transition.
Has it though? Because I think preventing lower-skill industry from migrating to lower-wage countries would have been a MASSIVE intervention into market dynamics with extremely unclear outcome, and it is very easy to be dishonest about its price and possible consequences.
An example: If we had wanted to prevent consumer electronics industry to shift abroad, we would have needed to massively intervene starting in the 1970s (!!). Products like radios, TVs, etc. would have been significantly more expensive, and a lot of that generations talent that made Intel, NVidia, Microsoft etc. happen might have stayed in those sectors instead, thanks to cushy subsidies.
Its quite possible that as a result, countries that did not waste so much effort on fighting market dynamics would have just pulled ahead. Comparing with a hypothetical timeline where there's a "healthy" (subsidised) US steel industry, lots of domestic electronics assembly and every other screen is "made in USA"-- BUT Microsoft is a European company instead, and Apple is Japanese-- that is a bad tradeoff in my view and entirely plausible.
Well, the hope that trade with China would lead to them becoming more democratic doesn't seem to have come through.
And there was a hope the West would keep doing the design work, and high-tech manufacturing. There isn't much Silicon being produced in Silicon Valley these days.
I'm not saying there's an alternative - I can't take a time machine back to the 1980s and explore a different timeline. I'm just saying that many of the purported long-term benefits of globalisation haven't really come about.
But answer honestly: Do you think that the US/Europe shaped their trade policies in a way that maximized foreign political improvement (especially pre-Crimea)? Because to me, that sounds almost comically self-delusional: We did not try to foster democracy when trading with Russia/China-- we traded to get stuff for cheap.
Looking at GDP development, this was very effective: Yes China grew more wealthy as well, but current trends are not looking like Chinese real wages will ever catch up to US levels, even in the next several decades...
I honestly believe that the US has profitted immensely from trade with China-- it would be insane to try to avoid this (and hold on to domestic industry) from a perspective of how it affected the average American citizen.
Sounds like you dont want freedom and capitalism anymore.
If you want to keep industries like this, you are basically arguing that taxpayers should subsidise them-- the jobs you retain are not a straightforward net gain, you pay for the wage difference in tax money (or price, where typically the consumer foots the bill, which is often just like a rather regressive tax).
There are good arguments that this is simply necessary for absolutely vital industries like agriculture, which gets a generous ~$20 billion/year to stay local. But it is clear to me that this is not something that you can do for every industry-- that would basically amount to a small-scale planned economy (with all its drawbacks), would be very likely to poach talent from sectors that are actually "more valuable" according to market consensus, and would also be likely to provoke retaliatory actions by international trading partners.
For this specifically, I think throwing some hundreds of millions of taxdollars around to keep/reestablish the industry is probably a good deal, but it is rather obvious to me that you have to draw the line somewhere; spending hundreds of billions to maximize autarky would be a really bad idea even though it is easy to make it sound universally good ("local jobs! supply chain safety! trade balance!").
Fire your unionized US workforce. Replace them a cheaper non-unionized workforce. Sell the goods at the same price. Increase your current profit margin while protecting future profit margins from unions.
Like half the reason why people do manufacturing in China is because all the manufacturing is there. If you had a problem with the item after it's been molded you can go to the molder and see what's going on. Then walk across the street to the plastic supplier to get them to adjust their output to fix your mold issues. That's not a Chinese specific thing, you can have this situation anywhere as long as the industries are co-located.
Isn’t “oh we’ll just make sure our population can’t leave” a tad dystopian?
My point is that moving manufacturing to China is not done at the government-level; it's a very smart move by business to break the unions in manufacturing while also increasing the current profit margin. Even if the American workers tried to move to China you wouldn't hire them because they're in a union so its pointless for them to moving (ignoring practical issues like language/family network/etc).
---
> Shouldn’t we be trying to (have local manufacturing) to reach the goal of a better life for our people, rather than sacrificing that life in order to (have local manufacturing)?
This is a false dichotomy. Manufacturing jobs while not as cushy as sitting in an office chair do not need to be deadly. There have been a ton of advances in robotics that allow you to be in significantly less harms way compared to the days of when you use children to repair equipment because their fingers fit in between the blades better.
I wouldn't be surprised if most manufacturing jobs had a lower mortality than dating while female.
It sure helps, but the primary reason is price. And the main driver for that are wages.
Chinese manufacturing pays workers an average $24k/year, for 49h/week. This is after adjusting for purchasing power-- actual mean wage is <$15k (!!).
You can shoot suspected union members on sight and allow dumping dimethyl mercury straight into the next river-- no amount of "regulatory streamlining" will come anywhere close to making the US competitive here.
If the Jones Act had worked it would have looked genius because it didn't require spending money by the government. It didn't work though.
So far the only effective method has been to purchase a fixed amount of the final desired product regardless of actual demand.
Outside of shipping idk what the analogous situation would be
Market forces are great, but should be ignored in key sectors that are important for national security. That goes for rare earth minerals or shipbuilding or key supplies for munitions or PPE that we needed during the pandemic, (etc.)
- USPS - literally written into the Constitution
- Passenger rail - Amtrak keeps pudding along even though financially it doesn’t make sense.
- Merchant marines - cargo is cheap. And cheaper in flag countries with lax labor rules. Yet, we maintain a expensive flotilla.
Other than that, as you said, the USPS is supposed to earn enough to pay for itself, which means that mail in cities tends to subsidize rural services.
Do USPS or other mail services in the US have pricing that depends on location? In Poland where I live (much smaller, more uniformly populated and not federal country), I've seen no such things. The prices are the same everywhere, so it seems to me that in every private, commercial mail service the cities kinda subsidize the rural areas.
UPS and FedEx and some of the other private shipping services have much more fine-grained pricing based on where something is going. This means that if you are Amazon, it is generally cheaper to send packages to cities by private carrier and cheaper to send to rural areas by USPS.
That's absolutely not true and anyone who has been involved in sourcing knows this.
There are plenty of other factors other than price alone. Reliability of source, quality, ability to response to changing volume demands, reputation, customer service, sustainability, overall capability, regulatory compliance, IP protection, financial health, quality management systems, etc.
It's the reason why any large corporation has a months long supplier due diligence process.
National security considerations can adapt to market forces by either directly subsidizing the domestic product (so that it will be as cheap as the foreign product) or establishing tariffs on the foreign product (so that it will be at least as expensive as the domestic product) or by outright banning the import of the foreign product (so that only the domestic product competes in the domestic market).
Market forces aren't real. They are artificial arbitrary rules agreed upon by a majority of participants in a financial system.
They are not natural laws like Newton's law of universal gravitation and the fact that even one person thinks they are is the greatest scam ever pulled on humanity.
Humanity will never be free until it rids itself of economists and MBAs.
There are uncountably many examples of humans, presumably normal, existing outside of the rules set by free market capitalism and not collapsing into a black hole.
One such example is the Indigenous peoples of Australia, who lived for tens of thousands more years than the concept of free market capitalism has existed, without even the concept of money or property beyond what one carried on their person.
I have to assume that they are "normal" humans.
Even today many aboriginals struggle with "tHe NaTuRaL LaWz of tEh MaRkEt JuSt LiKe GrAvItY BrAh TrUsT Me BrAHHHHH" because they've only been exposed to them for less than 0.3% of their culture's total existence.
There are examples, today, right now, this very minute, in (extremely northern) Europe of presumably normal humans who look at the rules you consider to be "natural" with shock and horror.
A cult has convinced you that their ideology is natural law. You can both participate in this system and realize that it is all bullshit and not be a hypocrite.
I keep wondering if these folks have a realistic alternative: https://www.nironmagnetics.com/ (They claim high performance rare earth free magnets.)
The iron nitride magnets require a special crystal structure, which is not the most stable for that material, so it is difficult to find processing methods so that the material will have that crystal structure and even if the structure is produced, it might revert in time to a more stable structure, which does not have the desired magnetic properties.
Like typical for such startups, that company does not say anything about which are the roadblocks that have prevented them for so many years to make iron nitride magnets until now, but it is pretty certain that their patents are bogus and the methods described there have not been usable for making what they claim to be able to make.
Lynas Rare Earths who are the largest miner and processor outside of China are in the initial stages of building a plant in Texas (which includes funding from the DoD). They currently have plants in Kalgoorlie and Malaysia, but not end-to-end making magnets.
Iluka have also secured the additional funding required for a processing plant in Australia and have deals with other miners for feed stock once they get going.
Disclaimer: I own shares in the above two and others and all currently at a loss on my initial investments.
"Less down" seems to be my preferred position.
They are "rare" per ton of earth in general
So it's just that mining them is so labor intensive and so toxic (uranium and other radioactivity) that it is expensive outside of places like China.
Automate that with bots or whatnot and maybe we don't have to invade Canada and Greenland and start WW3
The very recent turn of "we must literally own this territory" has been the surest possible way to create a crisis where none existed.
They are elements that require a lot of chemical processing to seperate and isolate.
The downside is that many of those processes generate a lot of toxic waste that requires (but often never receives) after treatment to neutralise.
Hence reports of dams of low level radioactive waste and so forth associate with rare earth processing (not so much mining as the concentrates are often mined and then shipped elsewhere for processing).
eg: https://www.benarnews.org/english/news/malaysian/rare-earths...
has been an on again, off again relationship for a decade and a half now due to the waste piling up.
Interesting to note that there is quite big movement towards rare earth free electrical motors in the last few years that rely only on cheap, readily available materials. Some expect that to grab up to 30% of the market in about a decade. Similar technology is also being used for creating wind generators that don't depend on these expensive/rare materials.
Synchronous reluctance motors where torque density isn't a strict requirement, and brushless separately excited synchronous motors (synchro motor with electromagnets on the rotor) for high torque/energy density applications?
In all applications where it is possible to use motors without permanent magnets, that is usually done, because the motors without permanent magnets are normally cheaper.
For high torque density applications, heat dissipation is often the limiting factor on duty cycle.
Also, the slip rings capable of passing high current to an electromagnet rotor are expensive and less robust than permanent magnets.
Essentially: it’s possible but I haven’t seen an application where it’s practical.
The new designs are all inductively coupled, i.e. they have a rotating transformer coil built into the shaft. No brushes, no slip rings.
If you had read the article you’d know they have their own mine: “Hardly any firms, even in China, do what MP is attempting: produce finished magnets starting with ore that the company mines itself” Mostly China doesn’t mine materials but has concentrated the refining capacity in China for many commodities. Thankfully, we do have backup capacity so we won’t be totally screwed if China cuts us off, and the refining technology is well understood and in a conflict we or our allies can cut them off from many raw materials so their refining advantage isn’t a checkmate.
Unless I'm working on old information, this is not correct. The overwhelming majority of neodymium mining capacity is currently in China.
> you’d know they have their own mine:
Sure, but to make a difference from a geopolitical perspective, we need more than that. And I don't see those kind of mines being opened on a large scale anywhere in the west. Regulations are challenging and environmental resistance is significant.
Aka buying magnets from China, crushing them, then reforming them into "American made" magnets.
We've been doing the same with steel for over a decade now. It's a good way around tariffs and origin laws.
I see on their site now that they are building a plant that is expected to produce 5 (five) tons of magnets per year (compared to 1500 t/year for the plant discussed in the article or with 25000 t/year for the biggest of the around 300 Chinese plants).
Such a small-scale production might be enough only to make samples to distribute to potential customers, to convince them to design products using such magnets.
I will be pleasantly surprised when Niron Magnetics will be able to produce even those 5 tons of magnets.
I have already forgotten how many years have passed since I have seen for the first time Niron Magnetics claiming that they will start soon the production of iron nitride magnets.
Certainly there are more than 5 years since then, perhaps almost 10 years.
Their first patents, in which they have claimed to know how to make iron nitride, have been issued 10 years ago. Their inability to actually produce such magnets demonstrate that at least the claims of the first patents were false.
The language that is used in patent law is that patents "teach" how to do something that was unknown and non-obvious for those who were experts in prior art.
I am pretty sure that the patents of Niron Magnetics do not teach anything, but they are the kind of patents filed by those who want to do something, but they have no idea how to do it, so they file bogus patents with overly broad and inaccurate claims, as a preventive strike used to block any competitors to introduce that kind of products, in order to gain for themselves time to actually discover how to make in reality what they want, in a very different way than described in their fictitious patents.
If iron nitride magnets are indeed possible, then it is likely that Niron Magnetics has delayed by many years their use in practice, by being unable to develop such materials themselves, but simultaneously preventing others to do this.
If they do not, they will run out of money and close after expending whatever capital they have.
Rinse and repeat and brrr goes the money printer.
Neodymium magnets are fascinating: they have enabled much smaller and more efficient elevator engines, used as undulators in synchroton x-ray sources, and many other places.
30 years ago the opposite was celebrated as the saviour of American capitalism (by short term thinking people who are probably billionaires now, and therefore, as individuals, insulated against any of the '30 years later' repercussions).
The US is going to need to naturalise all of its illegal immigrants to have a chance at ramping up local manufacturing.