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Prices of Rare Earths

Critical Metals Vital to Our Lives in Tight Supply


Rare Earth Elements

We begin 2012 similar to how we started 2011 when it comes to rare earth, rare technical metals and rare industrial metals. China has over 90% of production and refining. The US and EU governments are scrambling to legislate, source, produce, open and reopen mines. The West has decided to continue down the road of the idea that the markets will take care of the supply and price of these metals. What is alarming is how easily the West was lulled to sleep by China´s ability to supply the world its metals cheaply and efficiently. The West concentrated on making money trading stocks and futures that dealt with these commodities. China concentrated on building the most extensive mining industry in the history of man. Here in 2012 the Department of Energy in the USA has approved a spending bill that includes $20 Million to focus on the supply issues of these metals.

The metals I am speaking about are so vital to our everyday lives. These metals are found in your mobile phones, computers, LCD and LED TV´s, hybrid cars, solar power, wind power, nuclear power, efficient lighting and medical technologies. Here is a list of metals that have been deemed critical.

  • Indium RIM (Solar, Mobile Phones, LCD)
  • Tellurium RIM (Solar, Computers, Semi-conductors)
  • Gallium RIM (Solar, Mobile Phones, LED´s, Fuel Cells)
  • Hafnium RIM (Processors, Nuclear, Lighting, Plasma Cutting Tools)
  • Tantalum RIM (Capacitors, Medical Implants, Mobile Phones, Nuclear)
  • Tungsten RIM (Nuclear, Armaments, Aviation)
  • Yttrium REE (Lighting, Medical Technology, Magnets in Hybrids)
  • Neodymium REE (Magnets in Wind power, Super Magnets, Hybrid Vehicles)
  • Dysprosium REE (Computers, Nuclear, Hybrid Vehicles)
  • Europium REE (Lighting, LED´s, Lasers
  • Lanthanum REE (Hybrid Vehicles, Magnets, Optics)
  • Cerium REE (LED´s, Catalytic Converters, Magnets)

RIM=Rare Industrial Metal REE=Rare Earth Element

The supplies of these metals could hold back the production of green technologies. According to the latest report by the Department of Energy, ¨Supply challenges for five rare earth metals may affect clean energy technology deployment in the years ahead¨. If Green technology is to become main stream, the costs of these technologies have to reach cost parity with traditional energy sources. As long as there are serious supply issues with these metals the costs can´t reach these levels. The other option is finding alternatives like Graphene and Nanotechnologies.

The US and EU need supply chains of the metals that include both mining and refining of these metals. Relying on sovereign states for critical metals such as these, leave a nation vulnerable to outside influence in both politics and economics. Environmentalists have succeeded in influencing politicians to close mines throughout the West. Politicians have legislated the mining industry into the position it is in today. The Western nations must start now to build its supply chain or continue to be at the mercy of the BRIC (Brazil, Russia, India and China) nations for its metal needs.

The best the West can do now is provide, enough metals to meet its own demands. China has reached a point where it can now demand that certain industries produce their products there. If a company decides to try to produce the product in another country China will make producing that item cost prohibitive outside of China by raising the prices of the metals.

The demand for the products these metals are used to produce, are showing few signs of slowing down even in a so-called recession. Governments are subsidizing Green technology, people are buying mobile phones across the planet and everybody wants a nice flat screen TV. Will 2012 pass without countries truly taking this opportunity to fix the problem or will they step up and make the hard decisions which can put the countries back in control over their own destiny?

By: Randy Hilarski - The Rare Metals Guy

Rare earths On the wrong foot

The skyrocketing prices of some rare earths in professional circles have long been a controversial subject. Meanwhile, some rare earths have become so expensive that it now expected to increase the prices of end products. Manufacturers are looking for alternatives.

Dirty and expensive: there is plenty of rare earths, but they are funded almost exclusively in China.

The permanent magnet, many know him as a horseshoe magnet, has become an important part of the auto industry for electric and hybrid drives, which are developed with high pressure. It could also be electromagnets. But many have opted for the simpler permanent magnets - which they might regret in the long run. Because the magnets are not just made of iron, cobalt or nickel. Without neodymium and dysprosium they would not work. These are two of a total of 17 rare earths, raw materials whose prices have skyrocketed.

BMW still can not see any effects. There are no bottlenecks, especially the needs of such magnets for new, alternative drives in the development stage is still low, says a spokesman for the Munich carmaker. Their suppliers would be secured through long-term contracts also. Of course, he must concede, the increased cost could become an issue as soon as a volume production run.

A time bomb is ticking: The skyrocketing prices of lanthanum, neodymium, dysprosium and europium is since 2010 in professional circles has long been a controversial subject. The negative effects that made creating mainly producers on the procurement side, with increased raw material prices are now slowly in the long chain from production to up to the consumer. Thus, the largest European manufacturer of home appliances, Bosch and Siemens Hausgeräte GmbH (BSH), has not ruled out price increases for products 2011/12. This is caused not only become expensive steel and stainless steel, so the whole industry wants to raise prices. Rare earths have become a factor. “We are doing everything that we pass on the increased costs of steel and rare earth is not 1:1 on our product prices,” says a spokeswoman for BSH.

Rare earths BSH needed for the enamelling of stoves. For motors and pumps up those permanent magnets are needed, how they want to incorporate into his BMW alternative drives. The wind turbines are also used in small consumer-related components of information and communications technology and consumer electronics (MP3 player). Rare earths are found in rechargeable nickel-metal hydride batteries, cell phones, tablet PCs, X-ray machines, CT scanners, plasma screens and energy-saving lamps.

The manufacturer of energy saving lamps have justified the price increase on the wholesale distribution of 20 to 25 percent more expensive with the strong resources. Rare earths were once terms of value in the low single-digit percentage, he is now risen to almost one third. These dimensions can be used in the pricing of end products can not be ignored. “The rise in prices of materials are currently the biggest challenge for electronics companies,” said Bernhard Rohleder, Director General of the Association of Information Technology, Telecommunications and New Media (Bitkom). He is likely not alone my problems on the purchasing side, but also the challenges in the markets - because the cost is often compared to the excesses of pressure on margins due to fierce competition.

The name confused: Rare earths are not rare. Rather, they are found in very low concentrations in minerals, so their production is complicated and expensive. That is the reason why many countries have largely retreated with resources such as the United States, Australia and the former CIS states from the promotion. They left China the field. The country has the largest presence by far the world and today it is 97 percent. For a long time is the accusation that China is artificially scarce supply.

Now, behind closed doors, according to allegations in industry circles, that the Chinese would not hold well for long-term supply and prices change quickly. So often loses the argument about long-term contracts to hedge on weight. The Munich manufacturer BSH Home Appliances has been working on alternative strategies. “There were already taking measures to reduce the compensation,” said the spokeswoman. “We expect success from it in one to two years.”

The Siemens Group, builder of wind turbines, has agreed to secure its supply base for neodymium permanent magnet, a joint venture with Australia’s Lynas. Lynas, the rare earth supports, would provide long-term partner, the company with raw materials. Computer manufacturer Fujitsu is also, according to a spokeswoman in search of replacement. The extent of the rise was still not fully recognize. Suppliers there have been no suggestion to raise prices. But Fujitsu is cautious: That could indeed come.

This article was translated from German.
By Ruediger Koehn

Swiss Metal Assets appears on Deutsche Welle Television Show