The global rare earth elements market is anticipated to reach USD 5.62 billion by 2025, according to a new report by Grand View Research, Inc. The growing use of permanent magnets in the production of batteries for electric vehicles is expected to propel the demand for rare earth elements including neodymium, praseodymium, dysprosium, gadolinium, and terbium over the forecast period. Neodymium and praseodymium based rare earth permanent magnets are majorly used in the manufacturing of batteries.
The growing demand for electric vehicles coupled with the government initiatives on reducing the CO2 emissions is expected to boost the demand for permanent magnets. In March 2019, the Chinese government reduced subsidies for electric vehicles in order to promote innovation amongst local manufacturers on account of declining costs. The incentives for electric cars with less than 400 km range decreased from 50,000 yuan to 25,000 yuan, while the incentives for vehicles ranging less than 250 km have been eliminated.
According to USGS, China holds the largest amount of reserves with 44 million tons and Malaysia holds the least amount of reserves with 30 thousand tons. It also stated that the U.S. has USD 6.2 trillion worth of mineral reserves. However, the stringent regulatory policies towards mining in the U.S. has forced the companies to import the raw materials from China. Hence, the production of raw material has been a major challenge for the U.S companies.
The increasing prices of rare earth elements and high investments to open new mines have given rise to recycling of the product. Japan is one of the major producer of recycled rare earth elements. In 2010, Hitachi developed a new technology for recycling rare-earth magnets from air conditioners and hard disk drives. It can separate recycle magnets approximately eight times more efficiently than conventional methods. In 2012, The Honda Corporation opened the first rare earth recycling plant. The company utilized used automotive parts containing metals to produce rare earth elements.
The key players in the rare earth elements market are involved in acquisitions, expansions, and long term binding agreements with their customers. In Nov 2017, Hitachi Metals Ltd acquired Santoku Corporation, a Japanese manufacturer of alloys. This strategy was aimed at accelerating the production of neodymium magnet alloys in order to achieve sustainable growth in the global market.
To request a sample copy or view summary of this report, click the link below:
www.grandviewresearch.com/industry-analysis/rare-earth-elements-market
Further key findings from the report suggest:
- Neodymium is anticipated to register a CAGR of 8.3%, in terms of volume, from 2019 to 2025 owing to growing demand for permanent magnets
- Catalyst application accounted for a revenue share of 18.7% in 2018 owing to increasing demand from automotive and petroleum refining industries.
- Middle East & Africa is expected to grow at a CAGR of 6.9%, in terms of volume, over the forecast period owing to rising investment in expansion of refinery capacities
- In 2016, Hitachi Metals Ltd entered into a joint venture with Zhong Ke San Huan Hi-Tech Co., Ltd. to manufacture Neodymium-Iron-Boron magnets
- The major players are adopting strategies like capacity expansion and agreements with the end-use industries to cater to growing demand for rare earth elements. For instance, in January 2018, Lynas Corporation signed an agreement with Bosch, an automotive component supplier. This agreement was aimed at ensuring continuous supply of rare earth materials to Bosch.
