SPATIAL ANALYSIS OF THE ADDED VALUE CHAINS IN THE RARE EARTHS INDUSTRY

Abstract

The rare earth metals (REM) which are considered to be critical mineral resources are becoming increasingly important for the high-tech sector of world economy. Analysis of the spatial distribution of REM-containing raw materials shows that it is less concentrated compared to that of their current production whereChinaaccounted for the lion’s share until recently.Chinais the main supplier of both raw concentrates (rare earth oxides), and, more recently, pure metals and alloys on the global market. Increase in labor costs, stricter environmental standards of production, but above all, the growing domestic demand for REMproducts resulted in the reduction of Chinese deliveries for the world market. In response to the market destabilization the developed countries have started to implement the concept of creating a complete industrial chain outsideChina. Significant investment projects realized in the «non-China space» are described. The revival of verticalintegrated forms of doing business in the developed countries with the aim of monitoring and control of the entire chain by a parent company is noted. Possible entry ofRussiainto the global REM-chain is discussed.