The market for hybrid vehicles is currently witnessing rapid growth with analysts expecting their demand to grow several folds during 2011-2015. The extensive adoption of these vehicles can be attributed to a number of factors. These include: a growing awareness among end users, government support, rapid technological advancements and a continuous increase in oil prices. Question marks, however, are currently hanging over the future growth of these vehicles – at least in the short term. A new study from IMARC Group, one of the world’s leading research and advisory firms entitled “The Global Rare Earth Elements Market 2011-2015: Is the Hype Justified?” finds that hybrid vehicles largely depend upon four rare earth elements –Praseodymium, Neodymium, Terbium, and Dysprosium. Out of these four elements, the later three are expected to face a critical supply crunch in the near future.
Findings from the report suggest that NdFeB magnets are the enabling technology for today’s electric vehicles. The commonly used rare earth magnets of today combine 31% Neodymium with 68% Iron and 1% Boron. However, these magnets when used in hybrid vehicles have to be alloyed with up to 4.5% of Dysprosium by weight that dramatically improves its temperature handling capability. Terbium, even though more expensive and a lot rarer than dysprosium, can also accomplish the same thing. Praseodymium may also added to the magnet to enhance its field strength. The report expects that the demand of NdFeB magnets is expected to grow exponentially with an increasing demand of hybrid vehicles. This in turn is expected to drive the consumption of the rare earth elements - Neodymium, Praseodymium, Dysprosium and Terbium in the coming years.
Findings from the report also suggested that NdFeB magnet manufacturers are heavily dependent upon China for their rare earth supplies. In 2010, China accounted for 99% of the global Terbium production, 98% of the global Praseodymium production and 97% of both Neodymium and Dysprosium production. As a result of its increasing domestic demand, the Chinese government in recent years has significantly restricted the export of these elements. For instance, between May 2010 and August 2011, the domestic prices for Neodymium in China increased eightfold, this resulted in the Chinese government decreasing its export quota and ramping up its export taxes on rare earths leading to sky rocketing prices and a shortage of rare earth elements for the rest of the world.
Supply demand projections from the report suggest that with the opening of a number of non-Chinese mines during 2011–2015, the production of these four rare earth elements will significantly increase and diversify. However, excluding Preseodymium which is expected to be oversupplied by 17%, the report expects the demand of Dysprosium, Terbium and Neodymium to outpace their total supply by 71%, 10% and 9% respectively by 2015. The report suggests that the shortage of these three rare earth elements may have a major impact on the growth of the hybrid car market as they have limited substitutes and recycling options.
IMARC’s new report entitled “The Global Rare Earth Elements Market 2011-2015: Is the Hype Justified?” provides an analytical and statistical insight into the global rare earth elements market. The study that has been undertaken using both desk-based as well as qualitative primary research has analyzed five aspects of the rare earth elements market.
Key Aspects Analyzed in this Report:
Understanding the Mining Economics of Rare Earth Elements:
Focus of the Analysis:
• Rare earth mine valuation
• Stages and time taken to develop and start production at a rare earth mine
• The total costs involved in rare earth mining
• Mining and downstream processing of rare earth elements
• Rare earth element pricing
Understanding China’s Role in the Global Rare Earth Elements Market:
Focus of the Analysis:
• China’s role in the global supply and demand of rare earth elements
• Reasons for China’s dominance
• China’s current and future supply strategies
Comprehensive Situation Analysis of the Global Rare Earth Elements Market:
Focus of the analysis:
• Quantifying the historical sales and production of rare earth elements
• Identification and evaluation of current global rare earth mines
• Identification and evaluation of mines expected to begin production in the next five years
• Current and future consumption of rare earth elements
Evaluating the Supply and Demand of Various Rare Earth Elements:
Focus of the analysis:
• Quantifying the production of each element from current and future mines
• Quantifying the current and future demand of each element
• Historical, current and future prices of each element
• Evaluating the supply risks of each element and its importance for clean technology
• Identification of critically undersupplied and oversupplied rare earth elements
Information Sources:
Information has been sourced from both primary and secondary sources:
• Primary sources include industry surveys and face to face/telephone interviews with industry experts.
• Secondary sources include proprietary databases and search engines. These sources include company websites and reports, books, trade journals, magazines, white papers, industry portals, government sources and access to more than 4000 paid databases
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