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Rare Earth Demand

Rare Earth Demand


Exact statistics are difficult to come by in the rare earths field, partly because there is no official statistics agency, partly because they rely on Chinese sources where smuggling occurs, and partly because the end uses are so disparate. That said, Frontier broadly agrees with the market forecasts of Industrial Mineral Corporation of Australia (IMCOA). The estimated deficit and surplus in 2010 along with a forecast for the situation in 2015 is shown below.


Supply Surplus or Deficit of major Rare Earths 2010 and 2015

(Percentage of total demand)

Surplus/Deficit of major RE's 2010 and 2015

Source: IMCOA (2011)


The demand for rare earth elements spans many different industries, each with their own demand dynamic, and given the unique chemical properties of rare earths, there may be entirely new uses for rare earths in the future. The demand for permanent magnets is the single most important sector.


The largest sub sector for magnet demand is in hard disk drives, where the only alternative, solid state drives, is not cost effective for mass data storage. Given the exponentially increasing volume of data being created, possibly increasing to 35 zettabytes in 2020 from 1.2 zettabytes in 2011, demand for the neodymium in hard disk drives looks set to be robust. Other magnet sectors which may grow rapidly are hybrid and electric vehicles where the vast majority of models are currently equipped with a neodymium magnet, although there are alternatives motors. At present most wind turbines do not use rare earths, however the increased reliability from neodymium magnets, particularly in the offshore wind sectors, has led to 9 out of 10 new wind turbine models to employ neodymium magnets.


The next most important sector is the phosphor and luminescence sector. The explosive growth in smart phones will increase demand for europium, terbium and yttrium. The increasing penetration of liquid crystal displays and plasma screens in emerging markets will place further strain on demand for these important heavy rare earths. However the largest marginal demand driver will be from the lighting sector, with legislation from many OECD countries, including the US and the EU, banning incandescent lightbulbs coming into effect in the 2012-2015 period.


The battery alloy segment faces an uncertain demand landscape, with competition from litihium ion batteries in many applications where nickel metal hydride (Ni-MH) batteries, which contain lanthanum and cerium, are currently used. Ni-MH batteries are currently used in most hybrids, so the growth rate of this segment will depend on whether carmakers like Toyota stick with Ni-MH batteries.


Fluid catalytic cracking catalysts, which contain lanthanum and cerium, are used in the oil industry to break long chain hydrocarbons into more useful forms such as gasoline. The increase in demand will depend on global oil output and will tend to increase as the oil that is produced becomes heavier, such as the oil sands from Canada. Chemical companies are currently trying to minimise rare earth use due to the large increases in the prices of lanthanum and cerium.


Demand for automotive catalysts, where cerium helps keep the catalyst free from soot, are expected to grow rapidly as ever stricter emissions criteria come into effect in the coming years in Europe and America. The growth of the glass additives sector will depend to an extent on whether the Chinese construction industry maintains its rapid growth rate. The demand for “others” may increase if a new use for rare earths, such as harvesting waste heat to make electricity, becomes viable. Beyond 2015 there is a broad consensus around a compound annual growth rate of demand of 10-15%.


Rare Earth Demand Articles/links


26 May 2011: An article by EDN highlighting how the ban on incandescent bulbs will lead to more demand for rare earth containing compact fluorescent lighting. “The 100-year-long reign of the incandescent light bulb is about to end. Rather than bemoaning its death, lighting-circuit designers would do well to see the opportunity in offering a light with instant-on, that dims without flicker, and that is reliable and cost-effective.” Energy Efficient Lights to Gain from Incandescent Ban


26 May 2011: An article by Novelnano regarding research efforts by GE to reduce the need for rare earth magnets. “So researchers are now working on new types of nanostructured magnets that would use smaller amounts of rare-earth metals than standard magnets. Many hurdles remain, but GE Global Research hopes to demonstrate new magnet materials within the next two years.” New Magnets Could Solve Our Rare-Earth Problems


23 May 2011: An article by Insideline reporting that some models of the 2012 Toyota Prius will contain lithium-ion batteries as opposed to rare earth containing Ni-MH batteries. “The Japan and European versions of the Prius V will get a new lithium-ion battery pack, while the U.S. edition will make do with an older-style nickel-metal hydride battery pack.” Toyota Delays U.S. Launch of 2012 Prius V Until Mid-October


01 May 2009: IBM compares and contrasts the use of hard disk drives, which contain rare earths, and solid state drives, which contain no rare earths. “While the cost of SSDs is trending downward, the $/GB for SSDs is still substantially higher than that of HDDs. Thus, it is not yet cost-effective for most applications to replace all HDDs with SSDs” Performance Value of Solid State Drives using IBM


01 May 2011: An article in the May/June 2011 edition of Renewable Energy Focus discusses the different type of rare earth turbines, and concludes that direct drive machines which contain rare earths are going to become more prevalent. “Present trends suggest that direct drive turbines with permanent magnet generators are the way of the future, particularly for offshore but also onshore.” Renewable Energy Focus (subscription required)


16 March 2011: An article which discusses the rapid increase in data creation. “Data continues to grow out of control. In mid-2010, the information universe carried 1.2 zettabytes and 2020 predictions expect nearly 44 times more at 35 zettabytes coming our way.” 11 Big-Data Analytics Predictions for 2011


01 March 2011: Albermarle, a provider of rare earth catalysts for the oil industry, explains its efforts to decrease the use of rare earths in response to the price spike in lanthanum. “Our LRT products will help our customers to further reduce their rare earth consumption, which should deliver substantial commercial benefits and help to them to combat the soaring costs of rare earth elements.” Albermarle Catalyst Courier Issue 79 Spring 2011, Rare Earth Metals: The Green Path Ahead (pdf)


28 February 2011: Glass Magazine reports on glass makers’ attempts to reduce the use of cerium oxide in glass polishing. “Every user of cerium oxide needs to review their procedures and use it wisely”. Closer look: China’s cap on rare earth exports hits North American glass industry


01 September 2010: Grace Davison, a provider of rare earth catalysts for the oil industry, explains in detail the role of rare earth catalysts in the oil industry. “Grace Davison is committed to working with each customer to re-optimize his/her catalyst formulation with the goal of reducing overall rare earth content of the catalyst while maintaining acceptable performance.” Grace Davison Catalagram #108 Fall 2010, Role of the Rare Earth Elements in Fluid Catalytic Cracking (pdf)


2009: Rhodia describe their rare earth containing automotive catalyst regenerator Eolys fluid. “The challenge with filtration is to “regenerate” the filter before it is completely blocked by the collected particles. This is achieved by burning the soot formed by the particles. Different types of diesel particulate filters have been developed, with the most efficient removing more than 99 percent of the exhaust gas particles.” Eolys

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