Substitution continues to plague the rare earths market as our high-tech metals index fell from its already low, entrenched lull.
Many manufacturers have found non-rare earth elements to use in battery, magnet and other applications or found a way to reuse and extend the life of the rare earths they already buy.
Rare Earths Light
Lanthanum, dysprosium, cerium oxide and europium oxide have all steadily fallen in price since 2011. These lighter rare earths were certainly helped down the slope by China ending its export quotas for rare earths but, honestly, the slide happened way before that thanks to substitution and reuse.
Cerium, for instance, is used to polish glass and silicon wafers commonly used in photovoltaic solar panels. Solar manufacturers have found ways to collect it and reuse it. Simple reuse has cut demand for cerium by 70%. This has been happening since roughly 2012 and cerium’s price has fallen in lockstep as purchasers stretched their cerium further.
The monthly Rare Earths MMI® registered a value of 24 in July, a decrease of 7.7% from 26 in June and close to its all-time low of 23 last year. Yes, our lowest index fell nearly 8%.
Molycorp Files Chapter 11
This substitution problem is the bane of the only US-based rare earths miner, Molycorp, Inc., whose business is based almost entirely on light rare earths. The heavy rare earths, such as yttria, are scarcer and have more specific uses. It came as no surprise, then, to regular MetalMiner readers that Molycorp filed for chapter 11 bankruptcy protection this month.
Molycorp has secured interim financing and is still operating, paying employees and selling product to clients such as Siemens AG for its wind turbines, but, long-term, it will need to sell products that can’t be as easily substituted or reused if it is to survive.
Actual Rare Earths Prices, Light and Heavy
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