If not today, then perhaps tomorrow?
Lurking near the surface, but under the public awareness these days is an issue that might have great economic consequences in the years ahead. And that issue is the supply of rare earth elements (REE), which are critical components to a great number of things.
We became aware of REE supply issues because of an ongoing interest in solar energy (energy in general, for that matter). While Proficient Sourcing has no expertise in REE, you may. If so, we would be most grateful for any additional information you can provide to our blog.
We believe the subject is one that will grow in economic importance over the next few years. As a group the REE have vital functions in very many markets, and efforts are underway to expand the supply of them as well as design substitutes. It will be an interesting subject to follow, and this is intended only as an introduction.
The term “rare earth elements”, REE’s, refers to 17 metallic elements, the 15 lanthanides plus scandium and yttrium. These seem to occur in the same ore deposits but are rarely found in sufficient concentrations to be economically mined. Only recently have advances in technology (plus skyrocketing prices) made economic separation practical.
The value of these REE lies in their unusual, and sometimes unique properties. Many of today’s cutting edge industries have grown only because of the use of these REE. A list of products that rely to some extent on these materials would include wind turbines, solar panels, catalytic converters, hybrid car batteries, fiber optic cables, computer and phone displays, compact fluorescent lamps, as well as household appliances and military defense systems., such as night vision goggles and guidance systems.
Even if your company has no direct interest in REE, your customers may and even their customers may as well. If this is a relatively new subject to you, examine the Wikipedia article (https://en.wikipedia.org/wiki/Rare_earth_element) for a nice list of the individual REE’s and important applications for each.
We believe REE’s present a very significant supply issue for the United States overall, and again, if you have specific information you can share, we would be most grateful.
The problem with all this is the combination of rapidly growing demand plus the fact that China currently controls about 90% of the world’s production of REE. As their own demands have increased China has decreased shipments, especially to Japan, which accounts for the astronomical price increases.
The good news, if there is any, is that other areas with potential extractable deposits exists in the US (Mountain Pass, CA), Australia, Brazil and Russia. Mountain Pass opened recently, so new supply sources are slowly coming on line. Whether or not they can keep up with demand remains to be seen.
Another hopeful prospect is recycling. Obviously the higher prices make recycling more feasible, and efforts are indeed underway. While this is encouraging, large problems remain. Another hopeful avenue is designing alternatives to these elements, but the particular properties of the REE are difficult to replicate in new materials and surely will require a very long time.
Alex King, director of the new Critical Materials Institute, reports this: “A circa-2000 cell phone used about two dozen elements; a modern smart phone uses more than 60”. Further, he noted that despite the relatively high concentrations of rare earths in technology, it’s actually chemically easier to separate them from the surrounding material in simple rocks than in complicated phones! Director King’s remarks can be seen in this 2013 article: https://e360.yale.edu/feature/a_scarcity_of_rare_metals_is_hindering_green_technologies/2711/.
And so we have yet another complication in our world of supply chain management. If you are involved with the REE problems, we wish you well, and again appeal for your contributions to our blog.