From the New York Post, May 26:
Biden looking to import materials needed for electric vehicles: report
The Biden administration is considering a plan to import the bulk of the materials needed to build electric vehicles and the batteries that power them instead of mining them domestically — a nod to environmental groups that make up a key part of the Democratic constituency, according to a report.
The plan under consideration would entail buying the materials from overseas markets and allow US manufacturers to assemble them into batteries or electric vehicles in an effort to create American jobs but still remain in the good graces of environmental groups, Reuters reported on Tuesday.
The plan would allow the US to reduce its dependence on China for the materials, the report said, but would be a blow to US miners.
“It’s not that hard to dig a hole,” an administration source told Reuters. “What’s hard is getting that stuff out and getting it to processing facilities. That’s what the US government is focused on.”The Biden administration’s approach differs substantially from that of former President Donald Trump, who preferred boosting the ability of domestic mines to extract the materials by streamlining some environmental procedures.
The “federal strategy lays out a blueprint for America to once again be a leader in the critical minerals sector,” then-Interior Secretary David Bernhardt said in a statement in June 2019.
“As with our energy security, the Trump Administration is dedicated to ensuring that we are never held hostage to foreign powers for the natural resources critical to our national security and economic growth. The Department will work expeditiously to implement the President’s strategy from streamlining the permitting process to locating domestic supplies of minerals,” he continued.
President Biden signed an order in February directing federal agencies to look for vulnerabilities in the supply chains for equipment needed in the battle against coronavirus but also for the materials needed to build large-capacity batteries for electric vehicles.
“While the US is a net exporter of electric vehicles, we are not a leader in the supply chain associated with electric battery production. The US could better leverage our sizeable lithium reserves and manufacturing know-how to expand domestic battery production,” the order said.
The US Commerce Department is putting together a conference next month to attract more electric vehicle manufacturing to the US as part of the administration’s commitment to boost the domestic electric vehicle market with tax credits in the proposed infrastructure package.
Under the Biden administration’s approach, the US would rely on Canada, Australia and Brazil to produce the majority of the raw materials while American businesses would ramp up competition to turn those materials into computer chips and batteries, Reuters reported.
Nailing down the supply chain for these materials doesn’t require the US to be their primary producer, the report said, citing a source.
According to figures from the World Bank, the US imports of minerals in 2018 relied mainly on Canada, China, Mexico, Brazil and South America.
But labor leaders, many of whom support Democratic candidates, said they don’t want their workers left out of a lucrative job market.
“Let’s let Americans extract these minerals from the earth,” Aaron Butler of United Association Local 469 union, which does work for Rio Tinto Ltd.’s proposed copper mine project in Arizona and endorsed Biden in the election, told Reuters.
“These are good-paying jobs.”.....
.....MUCH MORE
In the final scene of the play A Streetcar Named Desire the character Blanche DuBois says to the psychiatric hospital doctor who has come to take her to the mental institution:
"Whoever you are—I have always depended on the kindness of strangers."
Among the cognoscenti this last line has two meanings: 1) the sadness of the fact she has actually received no kindnesses, only trades for sex and 2) a signal that she has completely broken with reality.
ThoughtCo has a good overview of the received wisdom.
Look, I get it. There are real advantages in trading a depreciating currency for other people's stuff while keeping your own stuff in the ground.
And you don't have to deal with protesters from your own party at the mine sites.
It's just that, as we've seen over the last year, supply lines are fragile, a weak spot even without unfriendlies doing an interdiction.
Should someone actively attempt to halt transportation it would make the Ever Given snafu look like child's play. As just one example, China has been very active in extending their belt and road initiative in Panama, including a $1.4 billion bridge over the canal and rail and other infrastructure.
And that's just one potential flashpoint. The Chinese influence in Brazil, hitherto based on VALE and iron ore could potentially go exponential as Brazil expands/modernizes its shipping and rail infrastructure. And then there's Australia...and...
Tune in next week as we use Anna Karenina to explain the administration's American Families Plan:“All happy families are alike; each unhappy family is unhappy in its own way.”
