Earlier this month, we highlighted a report by the World Economic Forum and Deloitte which identifies shifts in manufacturing trends over the next decade and beyond. One such trend is the increased demand for and resulting scarcity of rare earth materials.
China currently controls 95 percent of the export market of rare earths, which has the United States, Europe and Japan concerned. Cost of rare earths increased from $10 per ton to almost $60 per ton over the last several years as a result of Chinese restriction on supply, and back in March, U.S. President Barack Obama announced he was bringing a fair trade action against China to counter such restrictions.
What happens when your supply chain, concentrated in one location, suddenly dries up? Are rare earth materials really that critical to a healthy, sustainable manufacturing economy and are there alternatives we should be investigating?
Contrary to what the name suggests, rare earths are not that rare—as common as zinc or copper—but only found in commercially viable quantities in China, Brazil, India, Sri Lanka and Australia.
The Mojave Desert in California once provided the U.S. with all its rare earth materials but now operates below capacity despite new techniques in extracting more minerals from rock. Other mining operations are on the horizon, but will take years to implement. Meanwhile, the shortage continues.
Rare earths have many commercial, military and even medical applications, and some, like Dysprosium—used in nuclear reactors—are found almost exclusively in China. Some rare earths are used as alloys to make metals stronger, while others are essential for making high-tech and energy-efficient products.
High-tech products are hugely rare earth dependent. TVs, computer screens and hard drives and mobile phones utilize many rare earth materials. Intel used 15 different elements in its computer chips in the 1990s and estimates that number will quadruple over the next few years. General Electric reports that its products use 70 of the first 83 elements in the periodic table.
And rare earths seem to be key in green energy advancement. Energy-efficient light bulbs, hybrid electric motors, rechargeable batteries and wind turbines are central to reducing carbon footprints and are all rare-earth reliant.
Lanthanum is used in nickel-metal hydride batteries in hybrid cars, and as engineers work to increase fuel efficiency the use of Lanthanum in cars could double. Cerium is a component in catalytic converters, reducing carbon emissions from the exhaust gas.
If it seems like over-mining rare earths in order to reduce our carbon emissions and environmental footprint is robbing Peter to pay Paul, you’d be right. And it’s not that difficult to imagine a world in which rare earths are on a par with conflict minerals, human rights violations and bootlegging galore. That’s why we need to start innovating right now.
Many companies are finding innovative alternatives to or ways to recycle rare earth materials. Toyota, a leader in the electric car market, has been reliant on neodymium magnets (magnets account for 20 percent of global rare earth consumption) in its vehicles, but due to the rising cost of this element they’ve entered into a venture with Tesla Motors to supply a motor and battery pack that doesn’t rely on permanent magnet technology.
With government funding, both the U.S. and Japan are busy working on magnet technology that relies less on rare earths, for example, hardened blends of iron and cobalt and combinations of iron and nitrogen.
The rising cost of rhenium—which is not technically a rare earth—motivated General Electric to form global recycling partnerships with other jet-engine makers to decrease the need for new materials. They are also developing superalloys made from nickel.
GE—also the largest manufacturer of wind turbines in the U.S.—aims to improve the strength of rare earth magnets by about 40 percent while decreasing the amount of rare earths in magnets by 80 percent. Magnets are used in wind turbines to control fluctuations in wind speed, but a wind turbine can contain as much as a ton and a half of rare earth permanent magnets.
But it’s not enough to focus only on the raw materials that go into a product. It’s imperitive to address rare earth shortage throughout the entire product lifecycle. Designing products which can be dismantled and recycled is a good step. How many U.S.-created rare earth-rich electronic product waste is sitting in a landfill somewhere in India?
Perhaps too, we should consider using rare earth materials only in products or applications with a long shelf life as apposed to throw away consumer products.
Is your company dependent on rare earth materials? Do you think there’s a compelling need to invest in alternatives?