Roskill reports that the rare earth elements industry stabilized in 2016 after a prolonged period of falling prices brought about by oversupply and falling demand in some key applications. The outlook for rare earth demand in key end-use applications is mixed. Demand for rare earths in permanent magnet applications has increased by 4% per year since 2011, representing 23% of the total rare earth demand in 2016; this demand is expected to increase to around 28% in 2020 before falling back toward 2026. Catalysts, metallurgical and ceramic applications are all expected to remain major end uses of rare earths through 2026, particularly cerium and lanthanum.
China continues to dominate production, according to Roskill, representing 88% of the global supply in 2016. The industry landscape in that country has changed in recent years, however, as a result of ongoing restructuring and consolidation in the Chinese domestic industry and a heavy emphasis placed on tackling illegal production by the Chinese state government. Increasingly stringent environmental permitting, the closure of excess capacity and continued production quotas have resulted in the China’s rare earth supply reaching its lowest level for 13 years.10 In 2015, China’s consumption of rare earths was led by magnets (35%), abrasives (18%) and catalysts (15%).
Domestically, the estimated distribution of rare earths by end use in 2015 was: catalysts, 60%; metallurgical applications and alloys, 10%; ceramics and glass, 10%; glass polishing, 10%; and other, 10%. Estimated consumption was flat at 17,000 t, while production dropped 24.1% to 4,100 t (see Table 3).
The estimated value of rare earth compounds and metals imported by the U.S. was $150 million in 2015. Imports rose 3.1% to 11,920 t, while exports jumped 27% to 7,860 t.
10. Rare Earths: Global Industry, Markets & Outlook Forecast to 2026 (published October 2016), Roskill, www.roskill.com.