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Rare earth elements

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CATEGORY ALERTS

Rare earth mineral processing race heating up in Saskatchewan

March 30, 2023
alert level: Medium
CATEGORY ALERTS

Krakatoa Resources has accomplished its shallow drilling campaign for rare earths

March 30, 2023
alert level: Low
CATEGORY ALERTS

Eastern Metals Limited obtained significant REE mineralization

March 30, 2023
alert level: Medium

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Rare earth elements Market Monitoring Dashboard


Price Trend
416.86
Apr-24
USD/Kilogram
History Forecast

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Rare earth elements Industry Benchmarks


Savings Achieved

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The average annual savings achieved in Rare earth elements category is 6.70%

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(in days)

The industry average payment terms in Rare earth elements category for the current quarter is 72.7 days

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    Rare earth elements market frequently asked questions


    The bargaining potential of buyers is medium to high, based on the end-use sector, as the demand scale differs across the verticals. Case in point, the present magnet industry downswing and the fragile commodity market offer the upper hand to the buyers in terms of price negotiation. On the other hand, since the global rare earth elements market is highly competitive, the bargaining potential of suppliers is medium to high.

    Rare earth metal producers continue to view China as their target geography as the developing region captures over 3/5 of the global mine production. Moreover, six state-funded local miners hold a significant chunk of the rare earth mining market.

    Due to the COVID-19 pandemic and its ripple effects, the worldwide mine output took a hard hit in 2020. In addition, market players began engaging in short-term contracts due to the high degree of fluctuation amidst the public-health crisis.

    The global rare earth elements market is consolidated, with leading players taking the bigger slice of the overall revenue. Further, the price competition in the market echoes the cut-throat rivalry between participants to boost their bottom lines and gain an edge over others.

    For new entrants, the yardstick to enter the global competitive landscape of the rare earth elements market is high as the extraction process, and subsequent treatment is a complicated process and involves high expenses. In addition, the competitive landscape is subject to increased compliance costs and high exit barriers.

    Rare earth elements market report transcript


    Rare Earth Metals Global Market Outlook:

    MARKET OVERVIEW

    Global Supply: 300,000 MMT (2022)

    Chinese Market Growth: (8-10) percent (2021–2024)

    Demand sectors: Permanent Magnets, Metallurgy, Autocatalysts

    • China would continue to dominate the market, in terms of production volume, as well as market potential for a long term

    • The largest rare earths reserves, and major rare earth processing facilities are present in China, which is projected to support the market’s sustained development. However, with various projects under development in the US, Australia will be a key trend to watch in the near future

    Porter's Analysis on Rare Earth Metals

    Supplier Power

    • The global rare earth elements market is highly consolidated and hence, the bargaining power of suppliers is medium to high. Six state-owned miners of China are holding a major share of the rare earths mining industry, thereby allowing China to keep a strong handle on production

    Barriers to New Entrants

    • The barriers to new entrants is considered high for rare earths market. The process of extracting and subsequent treatment is a complex process and involves high costs

    • The extraction process involves huge environmental cost. Some of the processes use acids for separation and the combustion with high temperatures emit carbon dioxide

    Intensity of Rivalry

    • Intensity of rivalry is medium, due to consolidation in the industry amongst the major players. There is high investment cost for entry, regulations, and high exit barriers

    • The struggle for market share and increased profitability is reflected in price competition

    Threat of Substitutes

    • Rare earth elements have very low substitute threat. Though substitutes are available, they are always considered less effective in many applications

    Buyer Power

    • Buyer power is medium to high, depending on the end-use industry, as the level of demand varies across the industries

    • For instance, the current magnet industry downturn and the weak commodity market provide added advantage to the buyers, in terms of price negotiation

    Cost Structure Analysis : Rare Earth Metals

    • China continues to hold a monopolistic position in the mining and processing of rare earths elements until today. Various other countries, such as the US, Australia, Europe, and Japan, are becoming highly concerned about their increasing dependence on China for stable supply of REEs

    • Mining attributes to 35 percent of the total cost and processing of rare earths ore contributes to 60 percent of the total cost of production

    Rare earth elements - Cost Structure – China-2022*

    • Mining of rare earth ores constitutes to 35 percent of the total cost involved in production

    • In China, extraction of rare earths is done by two main methods. The first involved removing layers of soil and transporting them to a leaching pond, where acids and chemicals are used to separate the REE from the soil/rock

    • Another process involves drilling holes into rocks and flushing out the rare earth ores by means of water and chemicals. This mix is then directly transported to the leaching ponds for further processing and separation of REE. The whole process of crushing, milling, separating rare earths as oxides from ores constitutes around 60 percent of total cost of production.

    • Tougher regulations governing rare earth mining and in-situ leaching operations were introduced in 2016, as rare earth mining causes huge destruction to the environment. The government of China has directed companies to upgrade their mining technologies and engage in more costly and less environmentally harmful mining and extraction processes. These include consolidating rare earth processing operations and locating them in designated industrial parks with wastewater treatment plants. Mining sites also are required to take steps to reduce erosion and cut down on dust

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