Rare earth elements play a vital and increasing role in a wide range of consumer electronics, in environmental technologies and in military applications.
Although rare earth deposits are known in several countries, production in recent years has been strongly concentrated in a very few locations.
In the light of this, and some issues relating to trade restrictions, there is considerable concern about the security of supply of these critical materials.
The BGS guide to Rare Earth Elements profiles their uses, geology, mining, processing and trade.
The rare earth elements (REE) are a group of 17 chemically similar metallic elements, including the non-lanthanides scandium and yttrium which have a diverse range of specific applications in a wide range of consumer electronics, in environmental technologies and in military applications.
The REE market is more complicated than that for many others metals because of the large number of elements and their broad range of applications for which demand fluctuates over time, largely as a result of technological developments.
REE can be divided into two groups: the light REE (e.g. neodymium, lanthanum, cerium) and the heavy REE (e.g. dysprosium, terbium).
The light REE are more abundant in many deposits and are typically easier to extract, reflected in their generally lower value. Neodymium is a critical component of high-strength, permanent magnets important for many 'green', carbon reducing technologies such as the motors in hybrid vehicles and wind turbines and consumer products including hard disk drives.
Dyprosium and terbium, are in significant demand, both having applications in magnets, with the latter being used in high temperature fuel cells. Cerium is used in automotive catalytic convertors and REE, particularly lanthanum, are important catalysts used in petroleum refining.
Lanthanum is also an essential component in nickel metal hydride (NiMH) rechargeable batteries that are important in products such as hybrid cars.
REE occur in a wide range of geological environments and major deposits have been identified in a number of countries.
An accurate figure for global rare earth resources is difficult to establish due to the quality and availability of data. China dominates world reserves with 37 per cent, followed by the CIS, USA and Australia.
Historically REE have been produced in a number of countries, however, production in recent years has been strongly concentrated in a very few locations, particularly China. Current concerns regarding access to REE resources are strongly linked to China's dominance of global REE production, which accounts for some 96 per cent of global supply.
Processing of REE minerals to a refined product is a complex process that is most advanced in China. China's current dominance of the market results from other producers being unable to compete with low-priced exports from China during the late 1980s and early 1990s.
Total reported world production of rare earth oxide (REO) in 2008 was 126 000 tonnes, a four per cent increase compared to 2007 (121 000 tonnes). World production has more than doubled in the last 15 years. However, with consumption of rare earth oxides in 2015 forecast to reach 190–210 000 tonnes it is predicted that demand will outpace supply for certain elements, particularly neodymium, dysprosium and terbium.
Until recently, REE prices have been relatively depressed resulting in limited interest in developing new mines outside China. However, over the last 18 months there has been a growing realisation amongst western governments of China's monopoly on the market.
The US Government has started to take notice of vulnerability to supply shortages following the release of a report entitled 'Rare Earth Materials in the Defense Supply Chain'. The UK Government has also recently commissioned a report entitled 'Lanthanide Resources and Alternatives' which concludes that shortages are expected for key heavy elements.
Current concerns about restrictions on supply from China have led to significant price increases. China has increased export tariffs for REE and has recently taken steps to restrict REE mining, particularly illegal production which has significant environmental impacts.
Earlier this year the Ministry of Land and Resources capped annual REE production at 892 000 tonnes and the Government has stopped issuing new licences for exploration of REE until mid-2011. A multitude of new REE projects outside China, at various stages of development, is testament to the current interest surrounding the sector, with projects in the USA (e.g. Mountain Pass, Molycorp), Australia (e.g. Mount Weld, Lynas Corp.), Canada, Kazakhstan and Greenland. Mount Weld and Mountain Pass are the most advanced of these and likely to commence production in the next couple of years.
Contact Andrew Bloodworth for further information.