Source:Recycling International
China remains the world’s largest producer and consumer of rare earth metals. However, it has lowered production of the highly valued materials in the second half of the year by 36%. This move is forcing carmakers and electronics producers to find alternative supplies to meet strong demand in these two sectors.
According to Adamas Intelligence, a research firm that closely tracks the rare earths industry, the cut in China’s quota for separation and smelting is an attempt to better control the market.
Production decrease
China is limiting domestic rare earth production in the second half of 2018 to 45 000 tonnes – said to be the lowest production figure in more than five years. Adamas calculates this will only be enough to supply China’s domestic buyers.
In the first half of 2018, the figure was 70 000 tonnes, 40% higher than the first half of 2017. But that increase was seen by analysts and manufacturers as a method to ‘legitimise’ black market production, with Chinese manufacturing still consuming most of the supply.
15% export jump
Chinese exports typically supply around 80% of the globe’s rare earth demand – approximately 156 000 tonnes annually. September figures show that exports jumped 15% from August levels, despite falling earlier in the year.
Prices for one key mineral, PrNd Oxide, could increase by between 10% and 50% within the next 12 months, according to the experts. It is thought likely this development will see overall prices double within next five years as demand outpaces supply.