Pittsburgh, Pennsylvania – Themarket for Rare Earths is completely out of whack. It’s due todistortions from the Chinese monopoly. The West has spent the past 20years sitting on its collective butt not understanding the seriousnessof this strategic resource-based issue. The chickens have come home toroost.
A few weeks back, I alerted the subscribers of my investment letter, Energy & Scarcity Investor,that the Chinese would be ramping up their stockpiling of Rare Earthproducts. The very next day, news hit the wires that Rare Earth pricesare skyrocketing. Dysprosium oxide prices, for example, doubled in thefirst two weeks of June. Price and availability are going nuts.
Beryllium prices are not on a tear…yet. But I am very bullish about the long-term prospects for this “minor metal.” The Daily Reckoning faithful may recall my column from June 7 entitled, “Beryllium…Even Sexier Than it Sounds.”I mentioned a couple of beryllium plays, while also asserting, “Therare earths are one of the very few industries that possess robustlong-term, growth potential, even if global economic activity continuesto disappoint.”
Well I’m back today to pound the drum again on this unique rareearth. Beryllium demand might receive a significant bump over the nextfew years, if a developmental nuclear energy technology takes hold. Thisone could be a game-changer.
Beryllium has phenomenal heat-flow characteristics. It cools off veryquickly. So take that idea, and now mix beryllium with uranium. You canbuild fuel rods with much greater ability to transfer heat away. Thatis, you can heat up the fuel rods and they’ll cool down a lot faster. Intheory, therefore, if you exposed hot beryllium alloy fuel rods to air,they wouldn’t melt down on you.
This is what did NOT happen at Fukushima, Japan, with theold-technology fuel rods that are zirconium-clad uranium. The Japaneserods – as with all fuel rods, everywhere across the world – held theheat and needed cooling water. When the system lost the cooling water,the Japanese plants experienced a series of catastrophic meltdowns. Bigproblems for a long time to come.
Researchers at Purdue University, Texas A&M and MIT are workingon making the beryllium-uranium metallurgy work. It’s not as easy asjust adding a bit of beryllium to the uranium melt. It’s a much morecomplex engineering process than that. There’s a lot of research ahead.But at this stage, it’s very promising. The research is yieldingexcellent data.
How long will it take to get the beryllium idea running in thenuclear field? It’s hard to say just now. But the up-side is that ifberyllium winds up in the nuclear fuel cycle, it’ll increase globalberyllium demand by an order of magnitude.