Why am I so good looking?

Come on folks, we’ve all been wondering. But don’t think I’m challenging Kylie for the title of fairest Aussie export of them all. I’m talking about rare metals.

Because without them the picture gracing the home page of this blog – which a lot of you are reading on your iPhones – wouldn’t look half so good.

Europium and terbium help make the brilliant colours on your phones stand out and cerium buffs the glass so I don’t look any more craggy than usual. The fact you can see me at all so long after your last charge is thanks to lithium, without which the battery would be so heavy it would make your suit sag like one of Les Patterson’s cast-offs.

And without the super-magnets sprinkled with neodymium magic dust in high-tech electric motors most of the new EVs and hybrid cars of today and tomorrow wouldn’t be possible. With the exception of Tesla of course who always want to try and do things a bit different. Maybe if they used neodymium super-magnets, Elon might get to his magic 500 mile range.

Over the weekend I’ve been reading: “The Elements Of Power” by David Abraham. He’s a Wall Street analyst and has worked for the White House, and he knows what he’s talking about.

As Mr Abraham says, rare metals are everywhere: earphones, cars, TVs and loads more things that you use every day without even knowing it. The new super-high-tech American F-35 fighters are so full of rare metals they’re basically flying periodic tables.

And what we take for granted today, was unthinkable 10 years ago. Tapping the screen; sliding to the next news page; pinching to enlarge my photo and get a better look at me – all complete science fiction the last time England fielded a decent rugby team. Now, thanks to indium, we have an invisible link between the phone and your finger.

The great thing about this book is that Mr Abraham puts it all in language you can understand without needing a doctorate in metallurgy. He says you should think about rare metals like yeast in a pizza: you only need tiny quantities but they’re vital to the finished product.

Crucially though, he makes the point that these things have been around forever, but largely ignored. (When Mobuto was stripping his country of rare metals and spending the proceeds on pink champagne for his jungle palace, the US ambassador cabled Washington to tell them of the importance of ‘the Congo caviar’.)

Luckily, human innovation and vision has made the difference to the conventional opinion of recent decades that they’re nothing more than impurities.

For me ‘conventional opinions’ are like conventions: stuffy, old fashioned and in desperate need of a drink to liven them up.

You won’t catch me near either of them.

The trouble, and, of course, the opportunity, is that these little fellas are, well, rare. Rare in the sense of mined in small quantities only. So much so that a US General in the 1950s said they should be called ‘unobtainium’.

Supplies of most minor metals are scattered about in the earths crust in sufficient quantities to keep us all going for hundreds of years. The trouble is, the concentrations are usually so low its not profitable for anyone to try and dig them out. Which means many of the high-tech gizmos or manufacturing products they end up in are reliant on very taut supply lines.

So taut it sometimes comes down to a single mine.

The Companhia Brasileira de Metalurgia e Mineração (CBBM) in Brazil produces 85% of the world’s niobium. You only need a pinch of this magic stuff to transform the strength of steel. When the Eiffel tower was completed in 1889 it needed 7000 tons of steel. Build it today and you’d only need 2000 tons thanks to CBBM’s niobium. No wonder then that the US Government considers the mine it has in the town of Araxá so important they’ve put it on the list of critical infrastructure abroad.

Which is a polite way of saying the US Marines will have half an eye on it, just in case.

The book is full of colourful characters and a real insight into what will be the next great resource struggle after oil and gas. It’s a wake-up call to the world to take a look at this little-known sector. And it’s a call to arms for investors:

  “The problem in ensuring rare metal supply for our high-tech future is that the system for financing critical materials in much of the world essentially rests on a market that shuns risk and focuses on immediate gain”

The speed of technological change will soon outpace the ability of supply lines to deliver rare metals at today’s prices, especially with China monopolizing the market. So one of two things is going to happen. Either we’ll all give up our iPhones, or there’s an opportunity just around the corner.

And I know where I’m putting my money.

 

 

 

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Written by David Lenigas