Rare earths demand rises, supply crimp fuels global volatility
Mar 31, 2012 | 07:00 PM
| Myra Pinkham
Rising demand for a number of critical rare earth-containing productslike those used in the electronics, defense, automotive and alternative energy sectorsand actions by China, which controls more than 95 percent of global production, to influence supply, likely will keep the international rare earths market on a highly volatile path for some time.
Everyone is trying to get a jump ahead to see what the Chinese are doing, said Karl Gschneidner Jr., senior metallurgist at the U.S. Energy Departments Ames Laboratory and a distinguished professor at Iowa State Universitys Materials Science and Engineering Department in Ames, Iowa.
Over the past few years the Chinese government has imposed export quotas and tariffs on rare earth alloys, metals and oxides to ensure an internal supply amid a rapid growth in the countrys economy, he said.
The Chinese also have the lions share of rare earths processing capacity, with most of the processing facilities elsewhere closing their doors several years ago when rare earth prices plummeted. The only other country to provide conversion services is Japan, with only a marginal amount done in the United States, although some capacity could be added in the next 12 to 18 months, according to Steve Constantinides, director of technology at Arnold Magnetic Technologies Corp. in Rochester, N.Y.
However, that new capacity is expected to be exclusively for light rare earths and there currently is no separation capacity for heavy rare earth elements outside of China due to the complex chemistry of the process, according to Gareth Hatch, founding principal of consultancy Technology Metals Research LLC, Carpentersville, Ill., and president of Innovation Metals Corp., which began providing downstream processing and marketing services to the rare earths sector in 2011 with a light and medium rare earth elements processing facility in Vietnam.....
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