Rare Earth Metals, despite what the name would suggest, aren’t particularly rare. They are however all found clumped together, in a single ore, and are thus difficult to separate into individual elements. What are rare earth metals? There are 17 rare elements- 15 from the lanthanide series, alongside Scandium (At.no 21) and Yttrium (At.no 39). In terms of commercial applicability, rare earth minerals are gloriously lucrative. Mixed with other metals, these are used for applications that demand high magnetic strength and enhanced resistance to temperature. Bits of rare earth material can be found in computer chip-sets, batteries, smartphones, magnets, fluorescent lighting, and a plethora of other everyday essentials.
But wait, before picking up your pickaxes and excavators, consider this-
- Availability is limited, and any disruptions in the supply chain from major producers such as the US and China impacts the associated businesses across the world.
- Skilled labor in terms of experienced miners is difficult to come by.
- Long and laborious process involving topographical mapping, setting up of the mining and community infrastructure, and the final attainment of the commercial production status. This process could take five years or more.
- Return on Equity (ROE) is twice as volatile when compared to conventional mining operations.
- Too many red tapes involved including Federal regulations and trade union bylaws.
These, and a plethora of other factors, ensure that the procedures involved in the detection, extraction and sale of rare earth minerals remain an exclusive specialty. While the mining operations for rare earth metals looks like a profitable pursuit, the accompanying costs and the red tape push up the overheads considerably. Plus, getting the requisite mining rights is difficult and involves a considerable input in terms of infrastructure costs, negotiations and compliance with applicable policies.
Rare Earth Minerals- Costly and Prone to Substitution
The present-day consumer electronics industry is heavily dependent on the rare-earth metals industry to supply vital circuitry components that aid in the better performance of said chipsets. Unfortunately, rare earth metals don’t come cheap and the industry is constantly trying to negate this expenditure by looking for alternative, cheaper elements. Therein lies the challenge- cost effective substitutes.
However, demand isn’t caving in. In fact, the requirement for rare earth elements is ramping up thanks to the increment in end-user segments. The optical, metallurgical, chemical and magnetic properties of rare earth metals are widely exploited in such applications as glass additives and ceramics and sophisticated disciplines such as energy storage, superconductivity and catalysts. Revenue spiked at USD 6.46 billion in 2016 and the same is expected to double by 2021 to hinge at USD 12.26 billion. Through this 2016- 2021 cycle, the industry is expected to witness an impressive CAGR that will exceed the widely postulated 12%. Read Report.
The Technavio Advantage- Mining for Information
At Technavio, the expert analyst group is forever at the cutting edge when it comes to emerging market trends that hold an intimate connection to the global rare earth metals market. The resultant market research report is a 119-page dossier that addresses some of the key concerns of potential players in this discipline. Loaded with the most viable insights, the report is tasked with putting your interests first in its customized format, and to hold an informed mirror to the industry in its generalized form.
