According to analysts, rare earth metal prices have risen sharply over the past year, while adoption of new technologies like electric vehicles could push up the cost even more.
In the 12 months through September, the price of lithium carbonate, used in batteries, mobile devices and spacecraft, increased by 150 percent; The price of holmium oxide used in magnets and sensors rose 109.4 percent; And praseodymium-neodymium oxide used in magnets, motors and wind turbines accounts for 73.7 percent of the price, according to data from Shanghai Metals Markets (SMM) cited by Nikkei Asia.
“As demand for new energy vehicles and wind power continues to increase this year, demand for rare earths continues to increase,” SMM analysts wrote in a recent note. , “driven by the push to decarbonize economies.
In February the Biden administration ordered a review of key domestic supply chains, including critical minerals and materials, with a June report (PDF) noting that demand for rare earths is skyrocketing.
“Demand for many of these metals is projected to increase over the next two decades, especially as the world moves toward eliminating net carbon emissions by 2050. Global demand for lithium and graphite, for example, is highest for electric vehicle batteries. Two of the important materials, graphite is projected to grow by more than 4,000 percent by 2040, in a scenario where the world achieves its climate goals, graphite is projected to grow by about 2,500 percent,” the report said.
According to the report, the US Department of the Interior will lead a task force to identify sites in the United States where 17 rare earth metals used in products ranging from cellphones to electric vehicles can be produced and processed .
Analysts say that the drive to adopt new technologies is likely to put pressure on prices going forward.
“Electric vehicles of the future will also consume more rare earth materials, including praseodium and neodymium and others,” Hou Jinchen, an analyst at SMM, told Nikkei Asia. “There will still be ups and downs, but generally higher prices for all kinds of basic key materials could become a new normal for the foreseeable future.”
According to Zion Market Research, the global rare earth metals market was valued at around $8.1 billion in 2018, with estimates in October 2020 that the market is going to grow to around $14.4 billion by 2025.
Rare earths play an important role in many industries including consumer electronics, green technology, medical equipment and defence. These important minerals are also important for the production of weapons guidance systems, jet engines, sonar devices and laser weapons. The elements are plentiful and easy to mine; They are called “rare” because they are difficult to isolate and refine into a usable form.
In the 1980s, the United States was the world leader in the production of these elements, and nearly all US production was coming from a mine operated near Mountain Pass, California, which was closed in the 1990s. The mine was reopened in 2013 after China restricted supplies.
In recent decades, China has gradually become the dominant power in both the mining and refining of these elements. In 2020, China was projected to control about 55 percent of global rare earth mining capacity and 85 percent of rare earth refining, according to the Biden Administration’s Supply Chain Report.
Alice Sun and Emel Akan contributed to this report.
This News Originally From – The Epoch Times