The Return Of Resource Nationalism

But, it turned out that the Indian import ban was followed by increasing imports of palm oil into China which was trying to make up for the loss of soybean imports (another oil crop) from the United States due to trade frictions. The price of palm oil sailed upward.

Indonesia controls a substantial part of the another commodity market, nickel. The country's decision to ban nickel ore exports and move to develop its own refining industry gave a severe bump to world prices last year.

Resource nationalism is a counterpoint to the cornucopian dreams of the world's resource optimists. Resource nationalism would not be possible in the world where everything we need is plentiful or if not plentiful, can quickly be supplanted by a substitute of equal capability. It turns out that rare earths are hard to find a substitute for. It turns out that even nickel is hard to find a substitute for in the short run.

It's possible that all the flat screens, cellphones, industrial magnets, wind turbines, computers and other electrical devices that depend on rare earths could eventually be re-engineered to do without them. But the cost to do such re-engineering and the materials needed might make many devices that today are ubiquitous unaffordable to many.

The uneven distribution of resources makes resource nationalism possible. But what makes it likely to become a broader phenomenon in the future is the rate at which global society is consuming practically everything.

One example for which I could readily find historical estimates is oil. From the beginning of the oil age through 2007, global society is estimated to have consumed approximately 733 billion barrels. From 2008 through 2018, the world has consumed 371.2 billion additional barrels. Thus, in the space of just 11 years humans have burned through about one-third of all the oil ever consumed. Put another way, we have consumed half again as much oil in 11 years as was consumed by humanity in the first 148 years of the oil age since 1859 when Edwin Drake kicked off the modern oil age with his well in Titusville, Pennsylvania.

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Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular ...

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Gary Anderson 3 months ago Contributor's comment

Very interesting. But China reacted to American tariffs. We used to be for free trade, remember?

Texan Hunter 3 months ago Member's comment

Yes, but that's because there was a trade imbalance that needed to be corrected.

Gary Anderson 3 months ago Contributor's comment

If you read the most recent Mises article at Talkmarkets, you will see that a trade imbalance does not need to be corrected. I am not a Libertarian, but they are right about trade.