RECAPTURE STRATEGIC VALUE CHAINS IN THE RARE EARTH MARKET : A Contemporary Market Analysis Of Rare Earths And Their Economic Implications

This thesis analyzes the evolution of the contemporary rare earth market. The commodity has a growing strategic importance in key sectors, including the military-, energy-, high-tech- and automobile industry. 90 percent of the global supply has its origin from China, which binds buyers around the world to its exports. The evaluation of China’s market strategy illuminates the implications on its own supply hegemony and on foreign institutions. Within this context a major focus is placed on strategic value chains as well as on price determining factors for the rare earths. Both, Japan and the US are the largest consumer beyond Chinese border and are mostly active in researching alternative supply sources. Hence, the assessment of groundbreaking approaches to detach from China’s rare earth supremacy is carried out. The analysis outcome leads to the formulation of a competitive strategy for foreign market participants. Ultimately, the results of the examination show that the recapture of strategic value chains needs to be incentivized by economic-political measures. This will ensure to countervail against the price dependency, which is at the present days the main stimulus for the search of alternative supply sources