From where I'm standing, the city-sized Baogang Steel and Rare Earth complex dominates the horizon, its endless cooling towers and chimneys reaching up into grey, washed-out sky. Between it and me, stretching into the distance, lies an artificial lake filled with a black, barely-liquid, toxic sludge. 
 
 Dozens of pipes line the shore, churning out a torrent of thick, black, chemical waste from the refineries that surround the lake. The smell of sulphur and the roar of the pipes invades my senses. It feels like hell on Earth. 
 
 Welcome to Baotou, the largest industrial city in Inner Mongolia. I'm here with a group of architects and designers called the Unknown Fields Division, and this is the final stop on a three-week-long journey up the global supply chain, tracing back the route consumer goods take from China to our shops and homes, via container ships and factories. 
 
 You may not have heard of Baotou, but the mines and factories here help to keep our modern lives ticking. It is one of the world’s biggest suppliers of “rare earth” minerals. These elements can be found in everything from magnets in wind turbines and electric car motors, to the electronic guts of smartphones and flatscreen TVs. In 2009 China produced 95% of the world's supply of these elements, and it's estimated that the Bayan Obo mines just north of Baotou contain 70% of the world's reserves. But, as we would discover, at what cost? 
 
 Element of success 
 
 Rare earth minerals have played a key role in the transformation and explosive growth of China's world-beating economy over the last few decades. It's clear from visiting Baotou that it's had a huge, transformative impact on the city too. As the centre of this 21st Century gold-rush, Baotou feels very much like a frontier town. 
 
 In 1950, before rare earth mining started in earnest, the city had a population of 97,000. Today, the population is more than two-and-a-half million. There is only one reason for this huge influx of people - minerals. As a result Baotou often feels stuck somewhere between a brave new world of opportunity presented by the global capitalism that depends on it, and the fading memories of Communism that still line its Soviet era boulevards. Billboards for expensive American brands stand next to revolution-era propaganda murals, as the disinterested faces of Western supermodels gaze down on statues of Chairman Mao. At night, multicoloured lights, glass-dyed by rare earth elements, line the larger roads, turning the city into a scene from the movie Tron, while the smaller side streets are filled with drunk, vomiting refinery workers that spill from bars and barbecue joints. 
 
 Even before getting to the toxic lake, the environmental impact the rare earth industry has had on the city is painfully clear. At times it’s impossible to tell where the vast structure of the Baogang refineries complex ends and the city begins. Massive pipes erupt from the ground and run along roadways and sidewalks, arching into the air to cross roads like bridges. The streets here are wide, built to accommodate the constant stream of huge diesel-belching coal trucks that dwarf all other traffic. 
 
 After it rains they plough, unstoppable, through roads flooded with water turned black by coal dust. They line up by the sides of the road, queuing to turn into one of Baotou’s many coal-burning power stations that sit unsettlingly close to freshly built apartment towers. Everywhere you look, between the half-completed tower blocks and hastily thrown up multi-storey parking lots, is a forest of flame-tipped refinery towers and endless electricity pylons. The air is filled with a constant, ambient, smell of sulphur. It’s the kind of industrial landscape that America and Europe has largely forgotten – at one time parts of Detroit or Sheffield must have looked and smelled like this. 
 
 Quiet plant 
 
 One of our first visits in the city is to a processing plant that specialises mainly in producing cerium, one of the most abundant rare earth minerals. Cerium has a huge number of commercial applications, from colouring glass to making catalytic converters. The guide who shows us around the plant explains that they mainly produce cerium oxide, used to polish touchscreens on smartphones and tablets. 
 
 As we are wandering through the factory’s hangar-like rooms, it’s impossible not to notice that something is missing. Amongst the mazes of pipes, tanks, and centrifuges, there are no people. In fact there’s no activity at all. Apart from our voices, which echo through the huge sheds, the plant is silent. It’s very obviously not operating. When asked, our guide tells us the plant is closed for maintenance – but there’s no sign of that either: no maintenance crews, no cleaning or repairs being done. When pushed further our guide gets suspicious, wonders why we are asking so many questions, and clams up. It’s a behaviour we’ll encounter a lot in Baotou – a refusal to answer questions or stray off a strictly worded script. 
 
 As we leave, one of our party who has visited the area before suggests a possible explanation: could local industry be artificially controlling market scarcity of products like cerium oxide, in order to keep rare earth prices high? We can’t know for sure that this was the case the day we visited. Yet it would not be unprecedented: in 2012, for example, the news agency Xinhua reported that China’s largest rare earth producer was suspending operations to prevent price drops. 
 
 One of Baotou’s other main exports is neodymium, another rare earth with a variety of applications. Again it is used to dye glass, especially for making lasers, but perhaps its most important use is in making powerful yet lightweight magnets. Neodymium magnets are used in consumer electronics items such as in-ear headphones, cellphone microphones, and computer hard-drives. At the other end of the scale they are a vital component in large equipment that requires powerful magnetic fields, such as wind farm turbines and the motors that power the new generation of electric cars. We’re shown around a neodymium magnet factory by a guide who seems more open than our friend at the cerium plant. We’re even given some magnets to play with. But again, when our questions stray too far from applications and to production and associated environmental costs, the answers are less forthcoming, and pretty soon the visit is over. 
 
 The intriguing thing about both neodymium and cerium is that while they’re called rare earth minerals, they're actually fairly common. Neodymium is no rarer than copper or nickel and quite evenly distributed throughout the world’s crust. While China produces 90% of the global market’s neodymium, only 30% of the world’s deposits are located there. Arguably, what makes it, and cerium, scarce enough to be profitable are the hugely hazardous and toxic process needed to extract them from ore and to refine them into usable products. For example, cerium is extracted by crushing mineral mixtures and dissolving them in sulphuric and nitric acid, and this has to be done on a huge industrial scale, resulting in a vast amount of poisonous waste as a byproduct. It could be argued that China’s dominance of the rare earth market is less about geology and far more about the country’s willingness to take an environmental hit that other nations shy away from. 
 
 And there’s no better place to understand China’s true sacrifice than the shores of Baotou toxic lake. Apparently created by damming a river and flooding what was once farm land, the lake is a “tailings pond”: a dumping ground for waste byproducts. It takes just 20 minutes to reach the lake by car from the centre of the city, passing through abandoned countryside dominated by the industrial architecture on the horizon. Earlier reports claim the lake is guarded by the military, but we see no sign. We pass a shack that was presumably a guard hut at one point but it’s abandoned now; whoever was here left in a hurry, leaving their bedding, cooking stove, and instant noodle packets behind when they did. 
 
 We reached the shore, and looked across the lake. I’d seen some photos before I left for Inner Mongolia, but nothing prepared me for the sight. It’s a truly alien environment, dystopian and horrifying. The thought that it is man-made depressed and terrified me, as did the realisation that this was the byproduct not just of the consumer electronics in my pocket, but also green technologies like wind turbines and electric cars that we get so smugly excited about in the West. Unsure of quite how to react, I take photos and shoot video on my cerium polished iPhone. 
 
 You can see the lake on Google Maps, and that hints at the scale. Zoom in far enough and you can make out the dozens of pipes that line the shore. Unknown Fields’ Liam Young collected some samples of the waste and took it back to the UK to be tested. “The clay we collected from the toxic lake tested at around three times background radiation,” he later tells me. 
 
 Watch the black byproduct of rare earth mining pouring into the lake at Baotao (Credit: Richard John Seymour/Unknown Fields) 
 
 Unknown Fields has an unusual plan for the stuff. “We are using this radioactive clay to make a series of ceramic vessels modelled on traditional Ming vases,” Young explains, “each proportioned based on the amount of toxic waste produced by the rare earth minerals used in a particular tech gadget.” The idea is to illustrate the impact our consumer goods have on the environment, even when that environment might be unseen and thousands of miles away. 
 
 After seeing the impact of rare earth mining myself, it’s impossible to view the gadgets I use everyday in the same way. As I watched Apple announce their smart watch recently, a thought crossed my mind: once we made watches with minerals mined from the Earth and treated them like precious heirlooms; now we use even rarer minerals and we'll want to update them yearly. Technology companies continually urge us to upgrade; to buy the newest tablet or phone. But I cannot forget that it all begins in a place like Bautou, and a terrible toxic lake that stretches to the horizon. 
 
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 Read the first two instalments in this series, where Tim Maughan and the Unknown Fields group visits the Chinese city of Yiwu, the real home of Christmas and explore the invisible shipping network that keeps the world running 
 
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 This trip was organised and funded by the Unknown Fields Division, a group of architects, academics and designers at the Architectural Association School of Architecture in London. ||||| From the air it looks like a huge lake, fed by many tributaries, but on the ground it turns out to be a murky expanse of water, in which no fish or algae can survive. The shore is coated with a black crust, so thick you can walk on it. Into this huge, 10 sq km tailings pond nearby factories discharge water loaded with chemicals used to process the 17 most sought after minerals in the world, collectively known as rare earths. 
 
 The town of Baotou, in Inner Mongolia, is the largest Chinese source of these strategic elements, essential to advanced technology, from smartphones to GPS receivers, but also to wind farms and, above all, electric cars. The minerals are mined at Bayan Obo, 120km farther north, then brought to Baotou for processing. 
 
 The concentration of rare earths in the ore is very low, so they must be separated and purified, using hydro-metallurgical techniques and acid baths. China accounts for 97% of global output of these precious substances, with two-thirds produced in Baotou. 
 
 The foul waters of the tailings pond contain all sorts of toxic chemicals, but also radioactive elements such as thorium which, if ingested, cause cancers of the pancreas and lungs, and leukaemia. "Before the factories were built, there were just fields here as far as the eye can see. In the place of this radioactive sludge, there were watermelons, aubergines and tomatoes," says Li Guirong with a sigh. 
 
 It was in 1958 – when he was 10 – that a state-owned concern, the Baotou Iron and Steel company (Baogang), started producing rare-earth minerals. The lake appeared at that time. "To begin with we didn't notice the pollution it was causing. How could we have known?" As secretary general of the local branch of the Communist party, he is one of the few residents who dares to speak out. 
 
 Towards the end of the 1980s, Li explains, crops in nearby villages started to fail: "Plants grew badly. They would flower all right, but sometimes there was no fruit or they were small or smelt awful." Ten years later the villagers had to accept that vegetables simply would not grow any longer. In the village of Xinguang Sancun – much as in all those near the Baotou factories – farmers let some fields run wild and stopped planting anything but wheat and corn. 
 
 A study by the municipal environmental protection agency showed that rare-earth minerals were the source of their problems. The minerals themselves caused pollution, but also the dozens of new factories that had sprung up around the processing facilities and a fossil-fuel power station feeding Baotou's new industrial fabric. Residents of what was now known as the "rare-earth capital of the world" were inhaling solvent vapour, particularly sulphuric acid, as well as coal dust, clearly visible in the air between houses. 
 
 Now the soil and groundwater are saturated with toxic substances. Five years ago Li had to get rid of his sick pigs, the last survivors of a collection of cows, horses, chickens and goats, killed off by the toxins. 
 
 The farmers have moved away. Most of the small brick houses in Xinguang Sancun, huddling close to one another, are going to rack and ruin. In just 10 years the population has dropped from 2,000 to 300 people. 
 
 Lu Yongqing, 56, was one of the first to go. "I couldn't feed my family any longer," he says. He tried his luck at Baotou, working as a mason, then carrying bricks in a factory, finally resorting to selling vegetables at local markets, with odd jobs on the side. Registered as farmers in their identity papers, the refugees from Xinguang Sancun are treated as second-class citizens and mercilessly exploited. 
 
 The farmers who have stayed on tend to gather near the mahjong hall. "I have aching legs, like many of the villagers. There's a lot of diabetes, osteoporosis and chest problems. All the families are affected by illness," says He Guixiang, 60. "I've been knocking on government doors for nearly 20 years," she says. "To begin with I'd go every day, except Sundays." 
 
 By maintaining the pressure, the villagers have obtained the promise of financial compensation, as yet only partly fulfilled. There has been talk of new housing, too. Neatly arranged tower blocks have gone up a few kilometres west of their homes. They were funded by compensation paid by Baogang to the local government. 
 
 But the buildings stand empty. The government is demanding that the villagers buy the right to occupy their flat, but they will not be able to pass it on to their children. 
 
 Some tried to sell waste from the pond, which still has a high rare-earth content, to reprocessing plants. The sludge fetched about $300 a tonne. 
 
 But the central government has recently deprived them of even this resource. One of their number is on trial and may incur a 10-year prison sentence. 
 
 This article originally appeared in Le Monde ||||| Moreover, the tight export quotas have caused world prices to soar, even while holding steady in China. 
 
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 Officials in two departments of China’s General Administration of Customs in Beijing declined to comment on Thursday evening about the status of rare earth exports. The commerce ministry, which handles trade policy, also had no immediate comment. 
 
 Although deposits of rare earths are found in various parts of the world, including the United States, China produces about 95 percent of the global supply of the minerals. That is largely because rare earth mining and processing can be so environmentally risky, creating toxic and even radioactive wastes, that other countries have tended to avoid or abandon production. Only recently have other nations begun scrambling to develop or expand their own mining capabilities. 
 
 The Chinese shipments resumed Thursday morning only hours before Secretary of State Hillary Rodham Clinton raised the embargo issue at a news conference in Honolulu, where she announced plans to visit China on Saturday to pursue the matter with Chinese officials. 
 
 Mrs. Clinton spoke after meeting with Japan’s foreign minister, Seiji Maehara, and said that the suspension of shipments had been a “wake-up call” and that both countries would have to find alternative sources of rare earth materials. 
 
 Because China is on the opposite side of the international dateline from Honolulu, it was already midday on Thursday in China by the time Mrs. Clinton spoke in Honolulu on Wednesday. Later, after the New York Times Web site reported that the embargo had been lifted, an administration official said the United States was still seeking clarification from China. 
 
 In recent weeks, senior Chinese commerce ministry officials have insisted that they had not issued any regulations halting shipments. They have suggested at various times — implausibly, in the view of industry executives — that the halt resulted from a spontaneous and simultaneous decision by the country’s 32 authorized rare earth exporters not to make shipments, whether because of a deterioration in Sino-Japanese relations or a greater thoroughness on the part of customs inspectors. 
 
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 Under this year’s quota — 30,300 metric tons of authorized shipments — only a few thousand metric tons remain to be exported in 2010. Meanwhile, annual demand outside China for raw rare earths approaches 50,000 tons, according to industry estimates. 
 
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 The Chinese government assigns its quotas to the authorized exporters, who often trade those rights like commodities. As recently as 2008, the quota rights themselves had no market value. But lately, with rising demand, the value of the remaining quotas has soared to the point that the right to export a single ton of rare earths from China now sells for about $40,000, including special Chinese taxes . 
 
 That is a sizable, additional cost for buyers of neodymium, a rare earth used to make lightweight, powerful magnets essential to technologies including giant wind turbines , gasoline- electric cars and Apple iPhones. 
 
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 Neodymium sells for about $40,000 a metric ton in China, having recovered from a nose-dive during the global economic crisis. But it sells for twice that much outside the country because of the export restrictions, according to data from Metal Pages, a database service in London . 
 
 The cost of quotas has become exorbitant for users of lanthanum, which is vital for the catalytic converters that clean the exhaust of conventional, gasoline-powered cars. It is mostly produced here in Baotou, a smoggy mining and steel city in China’s Inner Mongolia that is the capital of China’s rare earth industry. Lanthanum sells for less than $4,500 a ton in China, but up to 10 times that much outside China because of the export restrictions. 
 
 Such price differences have created a big incentive for companies to move factories to China, and many already have. 
 
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 China’s shipping embargo has caused much more distress in Japan than in the United States or Europe, and not just because Japan’s shipments were cut off much earlier. It is because Japan tends to be affected more than other industrial nations by the way China sets its rare earth export quotas. 
 
 China’s quotas — and the shipping embargo — have involved only shipments in which the material has a rare earth content of about 50 percent or more. High-technology materials made from rare earths, like special magnetic powders for the clean energy and electronics industries, or polishing powders for the glass industry, are not subject to quotas and are inexpensively available. 
 
 Because the United States and Europe mainly buy highly processed rare earth powders from China, the customs policy of blocking shipments of raw rare earths had a limited, mostly symbolic effect. Japan, in contrast, is the biggest importer of raw rare earths and tends to process them into industrial materials. So Japan is more dependent on the materials affected by China’s tightening quotas. 
 
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 It was on Oct. 18 that the Chinese government broadened its halt in raw rare earths to include the United States and Europe. That step enabled customs officials to take the position that they were checking all rare earth shipments closely and were not singling out Japan. 
 
 The move also occurred only hours after Zhang Guobao, the country’s top energy official, summoned foreign reporters in Beijing. There, he delivered a blistering denunciation of the Obama administration’s decision the previous Friday to begin investigating whether China’s clean energy policies violated the World Trade Organization ’s free trade rules. But the exact interaction between American policy decisions and Chinese customs enforcement actions is unclear. 
 
 For China, the embargo on rare earth shipments has provided at least some geopolitical leverage. The halt was one of a series of measures that China took after Japan detained the captain of a Chinese fishing trawler that collided with two Japanese patrol boats; Japan later released the trawler’s captain. 
 
 Japanese companies had been able to weather the embargo without any significant factory shutdowns because many Japanese companies had accumulated rare earth stockpiles in the last few years. Still, the interruption of shipments caused dismay and alarm in the Japanese business community and Japan’s government.
– "Dystopian" and "horrifying" are just two adjectives Tim Maughan uses to describe for the BBC what he recently witnessed in the remote industrial city of Baotou in Inner Mongolia. Most disturbing was his visit to a man-made lake filled with toxic sludge that makes the surrounding area smell like sulfur, wielding an environmental impact that has turned the place into what Maughan says is "like hell on Earth." The wasteland is the site of one of the world's largest rare-earth-mineral productions, where processing plants churn out cerium oxide, neodymium, and other rare earth elements necessary for everything from consumer electronics (cellphones, tablet touchscreens) to the magnets in "green" products such as wind turbines and electric car motors, per the BBC. The unfortunate byproduct of this venture: the dangerous chemical waste in the lake right outside of the city, Maughan notes. China claims the lion's share of the world's production of these minerals: LiveScience has reported it produced about 95% of our rare earth elements in 2009. A local pol told the Guardian in 2012 that before the factories were erected in the late '50s, "there were watermelons, aubergines, and tomatoes." But Maughan—who traveled there with a design research group to "[trace] back the route consumer goods take from China to our shops and homes"—now found just abandoned outposts, "huge diesel-belching coal trucks," and the sludge-filled lake. "Nothing prepared me for the sight," he writes. "It's a truly alien environment. … The thought that it is man-made depressed and terrified me, as did the realization that this was the byproduct not just of the consumer electronics in my pocket, but also green technologies like wind turbines and electric cars that we get so smugly excited about in the West." (If you need happier environmental news, here's one good story.)