"Laggards of innovation in this space... risk being clipped by a new entrant into the market." - Paul Martyn, vice president of supply strategy at BravoSolution.
China's hold on the rare earths market is a source of constant frustration for manufacturers of high tech goods. China produces as much as 95% of the world's supply of these elements -- which are critical components of just about every electronic gadget we use today -- giving it unusual control over the global market.
This monopoly has allowed China a heavy influence on the price of such materials through production caps and export quotas. IndustryWeek reported recently that such market manipulations shot the price of one material, dysprosium, up from about $250 per kilogram in 2004 to $1,400 today, after reaching a high of $2,500 last year.
In a world dependent upon high tech gear and with manufacturers scrambling to cut costs wherever they can, the news cycles in recent months have been full of outcry over this artificial supply crisis.
While politicians and global trade organizations cry foul and demand fair shares, Paul Martyn, vice president of supply strategy at BravoSolution, argues that this situation marks a time for manufacturers to break free from China and do what they do best: innovate.