Korea Resources Corp., the state-run mineral explorer, is seeking to invest in mines in Africa and Asia to secure supplies of rare-earths, used in electric cars and wind turbines, Chief Executive Kim Shin Jong said.
“We have currently Africa, Central Asia, Mongolia and Vietnam in mind,” Kim said today in an interview after a seminar in Seoul. Separately, the miner is to meet this week with an Australian operator for cooperation in mining rare-earths, he said, declining to identify the company.
South Korea, which imports almost all its energy and minerals requirements, plans to reduce its dependency on Chinese supplies for rare earths after cutting overall imports of the materials by almost two-thirds since 2005. Prices for rare earths will probably keep rising as new supplies won’t appear any time soon, Commerzbank AG said in a Nov. 11 report.
“The world is in a fierce war for resources,” Kim said. Global prices of mineral resources are likely to remain “strong” as demand increases in the economic recovery. “What we can do to help our industries to grow continuously amid the resource war is to keep on running without a break.”
The price of lanthanum oxide, a rare earth used in hybrid cars such as Toyota Motor Corp.’s Prius, has surged more than sevenfold since the second quarter to $58 a kilogram after China cut export quotas. Rare earths are a group of 17 chemically similar metal elements including cerium, lanthanum and neodymium.
About 65 percent of South Korea’s rare-earth imports come from China, and 28 percent from Japan, according to the Ministry of Knowledge Economy. Finding alternative sources of the minerals will “take time,” Kim said. “It’s not something we can make in a year or two.”
Japan is also seeking to secure long-term supplies of rare earths after China slashed exports in September. Foreign Minister Seiji Maehara said Japan wanted to collaborate with Australia on rare-earth supply at a joint press conference last month with Australian Foreign Minister Kevin Rudd in Canberra.
Rare-earth exports from China, the world’s biggest supplier, declined 77 percent in October from a month earlier after the government reduced shipment quotas for the second half.