"Rare Earths in Myanmar: Unobtanium?", 14 June 2021

Kachin State in northern Myanmar has a long history of armed groups using illicit gold, copper, or iron deposits to fund insurgent activities.  Lately, reports have been trickling in about a free-for-all scramble for the control of another group of valuable metals: rare earths. The spurt in unauthorized mining, which began after the coup of February 1, appears to be taking place along the border with China. [...]

The rare earth mines in Kachin State have close ties to the Tatmadaw, Myanmar’s armed forces. The Border Guard Forces who control the mines are so-called “ceasefire groups” that made their peace with the military a decade ago. Their members include ex-communist insurgents as well as former soldiers of the Tatmadaw. Ceasefire groups often partner with regional military commanders in various business ventures, including mining. Human rights activists suspect the military may be profiting from the mining of rare earths, even as Western governments have imposed sanctions designed to curb the military’s extensive commercial interests. According to local environmental groups, there are more than 100 rare earth mines in Kachin State. When the civilian government was in power, the border was closed twice in 2019 to curb unregulated mining. But now that the army is back in charge, the floodgates have opened. As one activist told local media, “Currently, vehicles carrying heavy rare earth leave day and night.” [...]

Another inconvenient truth about the supply chain is that illegally mined ores, funneled through a network of intermediaries, are an unavoidable part of the rare earth pipeline. China introduced stringent regulations on the industry in 2011, which reduced clandestine mining by 50 percent. Consequently, the sole global supplier of rare earths became “heavily dependent” on Myanmar for raw materials. [...]