Electric Vehicles Drive Up Rare Earth Magnets Prices
Prices of Neodymium Magnets Increase
The price of rare earth minerals, used in the production of Rare Earth Magnets such as Neodymium, is trading at nearly double the 2016 average (as of August 2017). This alarming increase is believed to be driven by an expansion in electric vehicles and renewable energy.
At the end of 2010 and into 2011, the world was hit with a dramatic and unprecedented rise in the price of Rare Earths. The annual price of Neodymium-praseodymium oxide rose from $50 per kg in 2010 to nearly $250 per kg. Price validity for Rare Earth Magnets was being given in terms of hours rather and days or weeks, with significantly extended delivery times. Although the price fell in the following years, partly due to China losing a World Trade Organisation case brought by the USA and other trading partners in 2015, it has never returned to pre-2011 levels. The latest increase is the first since the major spike in 2011.
97% of the world’s Rare Earth minerals are mined in China. Rare Earth minerals are a key component of many items that people use every day including mobile phones, computer hard-drives, and watches, but it is the increased demand from renewable energy and the recent focus on electric vehicles that has stimulated the sudden price rise. Rare Earth Magnets are also used in the production of Magnetic Separators, which are used widely in the processing industry to remove tramp metal (e.g. food, chemical, pharmaceutical, plastics, mineral processing, etc) and to recover metals in recycling operations.
In electric vehicles, rare earth-based permanent magnet motors are preferred to induction motors as they are lighter and more powerful. This extends the distance an electric vehicle can travel before recharging.
Analysts from Argonaut Research estimate that there will be a 250% increase in the use of Rare Earth Magnet over the next 10 years. This will be driven by electric vehicles and wind turbines.
It appears that the remainder of 2017 could be bumpy for buyers of Rare Earth Magnets such as Neodymium. Although many suppliers of Rare Earth Magnets will be holding old stock purchases at a lower price, the increases will filter through to the end users very quickly. The future is very uncertain.
For more information on Neodymium, General Magnets and Magnetic Assemblies supplied by Bunting Magnetics Europe Ltd and via their online eMagnets UK shop, please contact us on:
Phone: +44(0)1442 875081
Via the Bunting Europe website for specialist magnets and magnetic assemblies