Interest in Rare Earths is starting to heat up once again, and it something you should keep on your radar. China’s Baotou Steel has announced its intention to start up the world’s first rare earths exchange. The move is expected to increase the liquidity and visibility of these valuable elements while reducing their trading costs. So named because they were hard to get in the 18th and 19th century, these once obscure elements have suddenly become the focus of several converging trends in the global economy, as they are the key ingredient of magnets. There are 17 in all, divided into light (cerium, Ce, lanthanum, La, and neodymium, Nd) and heavy (dysprosium, Dy, terbium, Tb, and europium, Eu). Since the beginning of the year, the price of 99% pure cerium oxide has rocketed by 650% to $11.50 a pound.
It turns out that you can’t build a hybrid or electric car, a wind turbine, thin film solar, LED’s, high performance batteries, or a cell phone without these elements. One Prius uses 25 kilograms of the stuff. You also can’t fight a modern war without rare earths, being essential for radar, missile guidance systems, navigation, and night vision goggles.
That’s where things get interesting. China now produces 97% of the world’s rare earth supplies, much of it coming from small mines operating by criminal gangs where it is safe to say, concerns about environmental damage are nil. In 2009, China announced that would start restricting rare earth exports, possibly banning several, it is thought, in order to force foreigners to buy more of their downstream electronic products.

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http://oilprice.com/Metals/Commodities/Rare-Earths-Are-About-to-Bec...

China is trying to choke the world supply and use these resources for their political gain. They already used it to force Japan to release the ship and crew who were supposedly captured in Japans territorial waters.

Top story: China halted the sale of rare earth metals to Japan over an escalating dispute sparked by Japan’s arrest of a Chinese ship captain. Chinese authorities refused to confirm that they were blocking the exports, but industry experts confirmed that customs officials in China had been preventing the metals from being loaded on ships in Chinese ports for the entire week.

http://margotbnews.wordpress.com/2010/09/23/china-blocks-exports-of...

The modern world runs on these commodities. They are used very widely in military hardware and all kinds of electronics. Many technology products simply can't be made without them. And China has 97% of the worlds production due to their rich deposits and previous efforts to manipulate the supply and demand by alternately selling off large volumes and suppressing their own domestic consumption. All while building a large reserve stock. Mines around the world were forced to shut down. Soon after the prices shot up beyond what they were before the dumping began.

They didn't do all this without long range plans to employ their market dominance for political ends. Keep an eye on these and the Platinum series of super metals.