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Nickel/Metals/ War – Geopolitical Flashpoints

Excerpt: From Meteorite Impact to Constellation City: A Historical Geography of Greater Sudbury – by Oiva W. Saarinen

To order a copy of “From Meteorite Impact to Constellation City”, please click here: http://www.wlupress.wlu.ca/Catalog/saarinen-meteorite.shtml

From International Nickel Company to Inco, and Merger with Mond (1902–1928)

Between 1902 and 1928, International Nickel prospered from the pre-war European demands for nickel in armour plate, the military needs of the First World War, increased peacetime uses for nickel in the United States, and the impact of the roaring twenties. By 1903, nickel production from Sudbury exceeded that of its main rival, New Caledonia. This dominance became continuous after 1905. The control of Sudbury’s wealth was paralleled by the dominance of International Nickel within the nickel industry. Through the use of long-term contracts with its consumers, the company was able to thwart competitors from entering the market, especially in the United States.

Its ability to meet the growing global demand for nickel was facilitated by the opening of Creighton mine in 1901 and the growth of this operation by the First World War into the world’s largest operating mine.10 Its output far surpassed that of the company’s other major source, Crean Hill.

Also significant was the opening of a new smelter by the CCC in Copper Cliff in 1904 which heralded the appearance of the first of three great smokestacks which dominated the Sudbury skyline for years to come. These smokestacks served to disperse the sulphur fumes released during the smelting process into the atmosphere.

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Excerpt from “The History of Mining: The events, technology and people involved in the industry that forged the modern world” – by Michael Coulson

To order a copy of The History of Mining, please click here: http://www.harriman-house.com/products/books/23161/business/Michael-Coulson/The-History-of-Mining/

THE RISE OF THE GULAGS AND NORILSK

The Soviet years of central control and direction saw a major push to develop the vast country into an economic powerhouse to match the West. These were the Stalin years and the expansion of the mining industry was often achieved by the use of labour transported to the Gulags of the eastern USSR. In these transportations dissident professional and manual workers alike were settled in camps, often for decades, until the death of Stalin in 1953 led to most of them being closed by 1960.

The Gulags had a number of key political functions, but economically they played an important role in the establishment of heavy industrial complexes for steel, manufacturing and mining, including mining of coal, iron ore and base metals. Gold production was also an important activity given that the rouble was unconvertible and the USSR was not a major manufacturing exporter like Germany or the UK, but was from time to time a heavy importer of food stuffs and advanced machinery, and therefore in need of convertible assets.


 

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Pentagon orders an about-face on REEs – by Shane Lasley (North of 60 Mining News – March 31, 2013)

 http://www.petroleumnews.com/miningnewsnorth/index.shtml

Department of Defense reverses its public stance on rare earths, recommends building a US$130M stockpile of the strategic minerals

About face; forward; march! The U.S. Department of Defense recently issued this order in the field of rare earth elements.

The unique properties of REEs – a group of 17 previously obscure metals that include scandium, yttrium and the 15 lanthanides – are key ingredients in a number of military applications such as guided missiles, lasers, radar systems, night vision equipment and battlefield communications.

China is estimated to supply between 90 and 95 percent of the world’s rare earth oxides, according to a September 2012 report penned by Congressional Research Service.

Though these Sino-mined elements are key ingredients to much of the U.S. Military’s advanced weapons systems, Pentagon officials have never considered REEs rare enough to need a stockpile of them.

“I wouldn’t run out and buy a bunch of rare earths,” DoD Industrial Policy Director Brett Lambert proclaimed during a defense conference held in New York late in 2010.

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Press Release: Strategic Materials Advisory Council Cautions DoD against Stockpiling Chinese Rare Earths

http://www.strategicmaterials.org/

Strategic Materials Advisory Council – Thu, Mar 21, 2013 2:27 PM EDT

WASHINGTON–(BUSINESS WIRE)– The Strategic Materials Advisory Council today cautioned the Department of Defense to avoid the risky mitigation strategy of stockpiling strategic and critical materials from China. The Department of Defense recently completed its biannual “Strategic and Critical Materials 2013 Report on Stockpile Requirements,” which recommended stockpiling $120.43 million of heavy rare earth elements — materials produced only in China.

“The root cause of these material shortages is our ongoing dependence on Chinese suppliers,” said Council Executive Director Jeff Green. “While it is encouraging that DoD acknowledges these risks, we urge DoD to move from theoretical studies to the only appropriate and permanent solution — the creation and nurturing of a U.S. based rare earth supply chain.”

This rare earth stockpile recommendation represents over one-third of a $319.74 million stockpiling plan to mitigate a $1.2 billion shortfall of 23 strategic and critical materials. This encouraging recommendation contrasts dramatically with previous Department of Defense assessments that asserted domestic sources could meet all military requirements by 2013, except for yttrium, and that substitution would be a viable approach to risk mitigation for heavy rare earths.

Green added, “It is equally encouraging that the Department is acknowledging the increased acquisition cost and engineering challenges posed by substitution strategies. However the U.S. must not rely on research projects and substitution alone to close the current supply gap.

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The Pentagon’s Metals Gap – by Daniel McGroarty (The Strategic Materials Advisory Council – March 7, 2013)

http://www.strategicmaterials.org/

Click here for the Strategic and Critical Materials 2013 Report on Stockpile Requirements: http://www.mineralsmakelife.org/assets/images/content/resources/Strategic%20and%20Critical%20Materials%202013%20Report%20on%20Stockpile%20Requirements.pdf

It’s the last thing any Washington watcher would expect in the run-up to Sequestergeddon: a government agency proposing a new spending program. Yet that’s precisely what the Pentagon did last week, with the quiet release of its National Defense Stockpile Report to the Congress.

Even experts in the industry are hard-pressed to recall when the U.S. Government last added to its metals and minerals inventory — and for good reason. Since the implosion of the Soviet Union in December 1991, the U.S. defense stockpile has been treated as a kind of raw materials garage-sale, with nearly all metals marked for a phased sell-off — calibrated so as not to unduly undercut current metal prices.

Stockpile silver went to the U.S. Mint for the striking of silver dollars, an almost literal swords-into-plowshares swap. Other metals were sold to pay for the cost of erecting the World War II Memorial without having to appropriate federal funds. Still more metals were sold with the proceeds flowing back to the U.S. Treasury, where they were spent on whatever it is the federal government funds to the tune of $10 billion a day.

And why not, given the demise of the Soviet threat and the emergence of a global market not seen outside an economic textbook. Surely the U.S. could source metals and minerals from providers anywhere on the planet, for the right price.

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When China’s Military Rivals America’s, Metals Demand Could Really Rocket – by Taras Berezowsky (Metal Miner – September 28, 2012)

http://agmetalminer.com/

A lot of militaristic hullaballoo has come wafting from the East China Sea lately, and all we can really do is sit here in the middle of the US and enjoy the show.

Well, that and ruminate on when these recent goings-on will affect the industrial metals markets. You’ve all likely read about the continued chest-thumping over the uninhabited islands claimed by Japan (which calls them the Senkakus) and China (which calls them the Diaoyus).

Recently, the Economist reported that a fleet of Taiwanese fishing boats and patrol ships entered the disputed waters. A skirmish involving water-cannons broke out between Japanese and Taiwanese vessels before the Taiwanese left the area.

A much different type of boat, meanwhile, was unveiled in China. The northern port city of Dalian hosted the ceremony for the 58,500-ton ‘Liaoning,’ the refurbished Admiral Kuznetsov-class aircraft carrier acquired from Ukraine — China’s first.

“The military utility of China’s carrier programme is questionable – at least in the context of any future showdown with America. But it says quite a lot about how China sees itself and how it wishes others to see it,” reads an Economist article.

From a geopolitical standpoint, that’s likely to hold true – but what if China’s continued push to boost its military presence also boosts demand for the likes of steel plate, titanium alloys, and other such military-grade metals in the decades to come? Could that take the place of the current priority, infrastructure spending?

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Steel armor plate for US military must be produced in the US – by Steve Bennish (Dayton Daily News – April 4, 2013)

http://www.daytondailynews.com/

The U.S. Department of Defense has restored a rule mandating that steel armor plate purchased by the U.S. military be made in the United States, a move that will benefit Ohio steel companies.

Ohio Sen. Sherrod Brown, in announcing the decision Wednesday, said Cleveland’s ArcelorMittal and Cliffs Natural Resources, as well as Nucor in Marion, Ind, stand to gain. All are involved in the production of armor plate.

“This is a win for our military and for American companies like ArcelorMittal, Cliffs, and Nucor, that make steel for our military right here in the United States,” Brown said. “We know how to make steel armor plate here in America, and there’s no reason why countries like China and Russia should be making the steel used in our military’s vehicles and equipment.”
Brown said the rule is consistent with legislation he had proposed. AK Steel does not make armor plate.

Donald Gallagher, Executive Vice President and President – Global Commercial of Cliffs Natural Resources Inc., praised the change.

“As a leading supplier of steelmaking raw materials, Cliffs understands the critical importance of producing defense-oriented iron and steel products in the U.S. from a domestic supply chain,” Gallagher said. “This final rule acts as recognition that domestic steelmakers have the capability to manufacture sufficient quantities of armor plate from the initial melting stages of production.”

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NFB Film: The Hole Story – by Richard Desjardins and Robert Monderie

 

The following is from the National Film Board of Canada Press Kit

THE FILM

“Don’t know much about mines? Not many people do. Mines don’t talk. Especially about their history.” Richard Desjardins and Robert Monderie explore this history in their latest documentary, The Hole Story. Produced by the National Film Board of Canada, the film continues in the same provocative vein as their earlier Forest Alert.

The history of mining in Canada is the story of astronomical profits made with utter disregard for the environment and human health. It’s also a corrupt and sometimes sinister story. For example, during the First World War, nickel from Sudbury was sold to the German army to make the bullets that ended up killing soldiers from Sudbury in the Battle of Vimy Ridge. In Cobalt, a town in Ontario that once had no garbage collection, people were dying of typhoid.

Meanwhile, the first Canadian mining magnates were growing filthy rich selling silver to England from the 40 mines surrounding the town.

Timmins has its own shameful mining story. In the woods,50 kilometres west of the railroad, prospectors quickly staked their claims before heading to the government office to register their hectares and take ownership of the subsoil.

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Sudbury in the 1960s – by Sudbury Star (Unknown Date)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The 1960s were a period of tension and turmoil in Sudbury, with huge changes in local labour organizations. It was also a period of massive urban renewal and municipal restructuring.

When the decade opened, the entire mining industry workforce was represented by one union — the International Union of Mine, Mill and Smelter Workers. When the decade ended, the United Steelworkers Union had established itself as bargaining agent for Inco employees in Sudbury.

To mark its presence in the community, the union purchased the former Legion Hall at Frood Road and College Street. The building became the Steelworkers Hall.

It was also a time of increasing demand for nickel products throughout the world, helped in no small part by the war in Vietnam. Both of the community’s mining companies, Inco and Falconbridge, were expanding operations.

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Strategic Minerals: Is China’s Consumption a Threat to United States Security? – by Dr. Kent Hughes Butts, Mr. Brent Bankus, and 2nd Lieutenant Adam Norris (U.S. Army War College – July, 2011)

“China’s resulting role in the mineral trade has increased
Western security community concern over strategic minerals
to its highest point since the end of the Cold War….The
U.S. dependence on overseas sources of strategic minerals
essential to sustain its economy and defense sector is more
pronounced than its dependence upon foreign oil….There is
not, for example, a substitute for … chromium in the
production of stainless steel.”
(U.S. Army War College Issue Paper)

 Center for Strategic Leadership,U.S. Army War College

For the web’s largest database of articles on the Ring of Fire mining camp, please go to: Ontario’s Ring of Fire Mineral Discovery

No great nation willingly allows its standard of life and culture to be lowered and no great nation accepts the risk that it will go hungry. — Hjalmer Schacht, German Minister of Economics, 1937

The vitality of a powerful nation depends upon its ability to secure access to the strategic resources necessary to sustain its economy and produce effective weapons for defense. This is especially true for the world’s two largest economies, those of the United States and China, which are similarly import dependent for around half of their petroleum imports and large quantities of their strategic minerals.

Because China’s economy and resource import dependence continue to grow at a high rate it has adopted a geopolitical strategy to secure strategic resources. China’s resulting role in the mineral trade has increased Western security community concern over strategic minerals to its highest point since the end of the Cold War.

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Pentagon in Race for Raw Materials – by Liam Pleven (Wall Street Journal – May 3, 2010)

The Wall Street Journal is an American English-language international daily newspaper. Published in New York City by Dow Jones & Company, the Journal has the largest newspaper circulation in the United States. Liam Pleven at liam.pleven@wsj.com

Stockpiling Minerals Takes on Greater Urgency as Global Supply Gets Squeezed

The U.S. military is gearing up to become a more active player in the global scramble for raw materials, as competition from China and other countries raises concerns about the cost and availability of resources deemed vital to national security.

The Defense Department holds in government warehouses a limited number of critical materials—such as cobalt, tin and zinc—worth about $1.6 billion as of late 2008. In the coming weeks, the Pentagon is likely to present a plan for Congress to overhaul its stockpiling program.

The new plan, dubbed the Strategic Materials Security Program by the Pentagon, would give the military greater power to decide what it stockpiles and how it goes about buying the materials. It would also speed up decision making at a time when military technology evolves rapidly, commodity markets swing widely and countries around the world fight to secure access to natural resources.

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Sustainability In Nickel Projects: 50 Years of Experience at Vale Inco – by S.W. Marcuson, J. Hooper, R.C. Osborne, K. Chow and J. Burchell (December 1, 2009)

The principal author, Dr. Sam Marcuson ( Sam.Marcuson@valeinco.com ) is vice-president, business improvement for Vale Inco Limited, Mississauga, ON, Canada. This article was adapted from a plenary speech made at the CIM Conference of Metallurgists held August 2009 in Sudbury, Ontario. The full paper is available from the author or the conference proceedings.

Looking at the industry’s past and present with a view to projecting into the future can be a valuable exercise for executing and maintaining sustainable development

The first eight years of this century saw rapid growth in the consumption and production of nickel and related commodities. In response to growth in the BRIC countries, but especially China, new projects, many in under-developed countries, were initiated. Nickel pig iron, produced in aging Chinese blast furnaces, unexpectedly emerged. Simultaneously, scientists concluded that global warming is “unequivocal” and human activity is the main driver, “very likely” (>90%) causing most of the rise in temperatures since 1950[1]. These factors point to a future in which sustainable development becomes of paramount interest to the mining and metallurgy industry.

To the practicing metallurgist and operator, “sustainability” may appear as keeping employees safe, meeting prevailing environmental regulations and contributing to social programs contractually agreed to, while maintaining a low-cost operation that meets production and financial targets. But this is a highly simplified view that ignores many of the sustainability concepts.

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Mining for victory [Inco, Nickel, World War Two] – by Stan Sudol (National Post – August 25, 2005)

Inco World War Two Poster
Inco World War Two Poster

Stan Sudol is a Toronto-based communications consultant who writes extensively on mining issues. stan.sudol@republicofmining.com

The Royal Canadian Mint last spring introduced the Victory Anniversary Nickel to commemorate the sacrifices and achievements of our fighting forces in the Second World War. In Sudbury and Port Colborne, Ont., that victory coin has many additional memories, especially for Inco Ltd and its work force.

During the war years, International Nickel Company of Canada, as it was known back then, and its employees in Sudbury and Port Colborne, supplied 95% of all Allied demands for nickel — a vital raw material critical for our final victory.

In fact, for much of the past century the leading source of this essential metal was the legendary Sudbury Basin; the South Pacific island of New Caledonia came a distant second. Until the mid-seventies, Sudbury supplied up to 90% of world demand during some periods.

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Down to the Sea in Inco’s Alloys (Part 2 of 2)

This backgrounder was produced for Inco employees worldwide in April 1990 by Denise Welker who at that time was a Communications Manager for Inco Alloys International Inc. The Inco Alloys division was sold in the late 1990s.

Inco’s History in Marine Alloys

Long before the advent of the nuclear navy, mariners were using Inco’s high performance alloys to conquer sea water corrosion. For more than 85 years, alloys invented and produced by Inco Alloys have demonstrated a special brand of strength and corrosion resistance – shoreline or offshore; above and below the water line.

MONEL alloy 400, a nickel copper alloy, was the first modern, high-strength, corrosion-resistant alloy to serve the U.S. Navy. Then cam MONEL alloy K-500, INCOLOY alloy 825, a nickel-iron-chromium alloy; and INCONEL alloys 625 and 718, nickel-chromium alloys. These and other Inco Alloys products have been working dependably at sea ever since.

Many marine applications don’t require the high levels of strength or corrosion resistance provided by these alloys. But when they do, these qualities are often critical. Failures are expensive, sometimes dangerous. For some applications, such as those in the nuclear submarine program, Inco Alloys products are the obvious choice to meet design demands. For many others, they are the long-term, cost-effective choice.

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Down to the Sea in Inco’s Alloys (Part 1 of 2)

This backgrounder was produced for Inco employees worldwide in April 1990 by Denise Welker who at that time was a Communications Manager for Inco Alloys International Inc. The Inco Alloys division was sold in the late 1990s.

The sun beamed brilliantly in the flawless blue sky and glimmered on the white hats of 308 sailors as they marched crisply on board ship to the notes of “Anchors Aweigh.”

Thousands of people, some clad in jeans, others in business suites, strained for a view of the huge submarine which stretched under the sailors’ feet like a sleek, black, metallic whale.

Then, with ship’s blessings, patriotic speeches, and a crack of a champagne bottle across her bow, the USS West Virginia officially began service in her country’s defense.

The date – October 14, 1989. the place – the Groton, Connecticut, headquarters of the Electric Boat Division of General Dynamics Corporation. The occasion – the launching of the eleventh Ohio-class Trident submarine, named for West Virginia,  home state of Inco Alloys International, Inc.

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