Sweden has Europe’s largest deposit of rare earths. It could help reduce dependence on China | CNN Business

Hong Kong
CNN
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Swedish mining company LKAB says it has found Europe’s largest deposit of rare earth oxides in the north of the country, a discovery that could reduce the mainland’s reliance on China for the critical resource.

Rare earth minerals play a key role in the generation of clean energy and the production of electric vehicles and consumer electronics. But the market is dominated by China, which accounts for 60% of global production, according to the US Geological Survey.

LKAB has identified more than one million tons of rare earth oxides in the Kiruna area, located in the far north of the country, the company said in a statement on Thursday.

“This is good news, not only for LKAB, the region and the Swedish people, but also for Europe and the climate,” said Jan Moström, LKAB Group President and CEO.

No rare earth elements are currently mined in Europe, leaving it dependent on imports. The European Union receives 98% of minerals from China, according to the European Commission.

But demand is expected to rise as a result of electrification, leading to global “undersupply” at a time of heightened geopolitical tensions, LKAB said.

The company added that the region’s dependence on China for rare earth minerals increases the vulnerability of the European industry.

“Electrification, self-sufficiency of the European Union and independence from Russia and China will begin at the mine,” said Ebba Busch, Sweden’s Minister of Energy, Business and Industry, in the same statement. “We must strengthen industrial value chains in Europe and create real opportunities for the electrification of our societies. ”

Still, the road to exploiting the deposits is long, LKAB added. He plans to apply for a permit later this year.

“If we look at how other permitting processes have worked in our industry, it will be at least 10-15 years before we can start mining and deliver raw materials to market,” he said.

Given its importance in the technology industry, rare earths have also become one of the main fronts of competition between the US and China.

The United States, long dependent on China for minerals, is looking to strengthen its domestic supply chain emerge as a dominant global player. In 2021, the Biden administration targeted rare earths, among other domestic supply chain priorities, to reduce the vulnerability of these industries to geopolitical tension.