Alfonzo, and 6 co-authors reported in 2014 on their views on the future availability of rare earth elements (REEs) being of concern regarding monopolistic supply conditions, environmentally unsustainable mining practices, and rapid demand growth. The authors presented an evaluation of potential future demand scenarios for REEs with a focus on the issue of co-mining. Many assumptions were made to simplify the analysis, but the scenarios identify some key variables that could affect future rare earth markets and market behavior. Increased use of wind energy and electric vehicles are key elements of a more sustainable future.
However, since present technologies for electric vehicles and wind turbines rely heavily on dysprosium (Dy) and neodymium (Nd), in rare-earth magnets, future adoption of these technologies may result in large and disproportionate increases in the demand for these two elements. For this study, upper and lower bound usage projections for REE in these applications were developed to evaluate the state of future REE supply availability. In the absence of efficient reuse and recycling or the development of technologies which use lower amounts of Dy and Nd, following a path consistent with stabilization of atmospheric CO2 at 450 ppm may lead to an increase of more than 700% and 2600% for Nd and Dy, respectively, over the next 25 years if the present REE needs in automotive and wind applications are representative of future needs.
A key aspect of material markets is that price signals encourage both suppliers and users to be adaptive. As demand for Nd and Dy increases disproportionately to demand for other RE, the prices of individual REEs will change encouraging manufacturers to reduce their net Nd and Dy use. This may be achieved through materials substitution, improved efficiency, and the increased reuse, recycling, and use of scrap.
Du and Graede estimated in 2007 the global in-use stocks of Pr, Nd, Tb, and Dy were four times the annual extraction rate of the individual elements. Moreover, wind turbines and electric vehicles may be more amenable to recycling due to their concentration of REE in single parts. Due to the inherent delay between consumption and recycling and the growing nature of REE demand, the impact of such recycling will likely only be significant in the long term. Although suppliers of REE are somewhat constrained by the geological concentration of REO in the ore, they can also adapt to prices by increasing yield of higher priced REEs.
In the end, prices are not the only forces that will influence the REE markets. Government intervention in this market is prevalent. Also, corporate social responsibility policies may influence some firm’s decisions to use REE unless environmental concerns around their mining are addressed. These issues should be considered carefully by interested stakeholders and future research on this topic.
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