Rare Earth Stocks

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U.S. Defense Department Sees No Rare-Earths Crisis; May Aid U.S. Producers

By Gopal Ratnam -

The U.S. Defense Department has concluded that China’s monopoly on rare-earth materials, used in military hardware such as missile guidance and radar systems, poses no threat to national security, according to a person familiar with a year-long study by the Pentagon.

The report notes that rising prices and supply uncertainties are spurring private investment in new mining operations outside of China that will help meet American military needs, which require less than 5 percent of U.S. rare- earth consumption.

China now provides 97 percent of the world’s rare earths, a group of 17 metals that includes neodymium, samarium, and dysprosium.

The study, conducted by the Pentagon’s Office of Industrial Policy, raises the possibility that the Defense Department may help prospective U.S. providers such as Molycorp Inc., the person said, speaking on the condition of anonymity because the report has not yet been released publicly.

Link to full article:

http://www.bloomberg.com/news/2010-10-30/pentagon-sees-no-security-threat-from-rare-earths-may-aid-u-s-producers.html