"There is already a shortage, because there are companies that already can't get enough material," said Jim Hedrick, a former USGS rare earth specialist who recently retired. "No one's trying to expand their use of rare earths because they know there's not more available."
"No one [in the U.S.] wants to be first to jump into the market because of the cost of building a separation plant," Hedrick explained. The former USGS specialist said that such a plant requires thousands of stainless steel tanks holding different chemical solutions to separate out all the individual rare earths.
The upfront costs seem daunting. Hedrick estimated that opening just one mine and building a new separation plant might cost anywhere from $500 million to $1 billion and would require a minimum of eight years. But Cowle, the CEO of U.S. Rare Earths, seems hopeful that momentum has already begun building for the U.S. government to encourage development of its own rare earth deposits.
"From what I see, security of supply is going to be more important than the prices," Cowle said.