They're also quite important to electronics and "green" technologies.
There's an interesting article in the NYT regarding China's near-monopoly on the extraction and production of these elements.
Some of the minerals crucial to green technologies are extracted in China using methods that inflict serious damage on the local environment. China dominates global rare earth production partly because of its willingness until now to tolerate highly polluting, low-cost mining.Since China has allowed the costs associated with environmental destruction to be externalized, its costs of production have been lower, and it has come to overwhelmingly dominate REE production, with an estimated 95% of the total.
The reason this is of importance is that China has slowly been moving to restrict exports of these materials, and instead concentrating industrial production of finished products within its borders. This means that instead of manufacturing, for example, neodymium magnets and electric motors here in the states, using Nd oxides imported from China, the final products would have to be imported.
Even tighter limits on production and exports, part of a plan from the Ministry of Industry and Information Technology, would ensure China has the supply for its own technological and economic needs, and force more manufacturers to make their wares here in order to have access to the minerals.I don't know much about the geology of rare earth ores, but young geologists might want to think about the growing importance of having secure domestic sources of these strategically and economically important materials.
Expectations of tightening Chinese restrictions have produced a surge in the last two weeks in the share prices of the few non-Chinese producers that are publicly traded. In addition to the two Australian mines, Avalon Rare Metals of Toronto is trying to open a mine in northwest Australia, and Molycorp Minerals is trying to reopen a mine in Mountain Pass, Calif.