Factbox: Western rare earths supply chain springs into gear

Northern Minerals

17/06/2024 17:02

(In paragraph 34, includes details of rare earth oxide
production by MP Materials)
       MELBOURNE, June 17 (Reuters) - Global supply chains for
rare earths are realigning to diversify away from top producer
China to make permanent magnets used in products from electric
vehicles to wind turbines and drones. 
    Below are companies that have or are building production
facilities for rare earth compounds, metals and magnets to
reduce the West's current near-total dependence on imports from
China.
    Rare earths processing occurs in two main stages. The first
involves extracting the rare earths from ores containing other
minerals and concentrating them into a mixed rare earth
concentrate or carbonate. The second is a more complex stage
that separates the rare earths into individual oxide compounds.
From there the products are turned into metals used to produce
magnets. 
    
    LYNAS RARE EARTHS
    Lynas Rare Earths  LYC.AX  is the world's biggest supplier
of rare earths compounds outside China, from its Mount Weld mine
in Australia. It has processing operations in Australia and
Malaysia and is building a heavy rare earths processing plant in
Texas, with the help of $288 million in U.S. defense funding,
expected to come online in fiscal 2026. It will be able to
process third-party material.
    
    SOLVAY
    Belgian chemicals maker Solvay  SOLB.BR  is expanding rare
earths processing at its La Rochelle operations in France,
aiming to launch separation and production of rare earth oxides
needed for permanent magnet production in 2025. Currently Solvay
processes rare earths for other uses, such as for auto
catalysts. In March, Solvay signed a memorandum of understanding
with French rare earths partner Carester to look at
manufacturing opportunities for the permanent magnets supply
chain in Europe. It also has an agreement to buy rare earth
oxides from recycled material from Canadian clean tech start-up
Cyclic Materials.
    France-based Carester aims to recycle 2,000 metric tons of
magnets and separate 5,000 tons of heavy rare earth concentrates
from mining per year from 2026.
    
    VACUUMSCHMELZE
    Germany's Vacuumschmelze  ONEQPV.UL , one of the biggest
permanent magnet producers outside of China, has manufacturing
operations in Germany, Slovakia, Finland, China and Malaysia. It
was bought by U.S. private equity firm Ara Partners in October.
    It was awarded U.S. government funding of $111.6 million to
build a neodymium-iron-boron magnet plant in South Carolina. The
plant is expected to be finished by late 2025. 
    The company has a magnet supply agreement with General
Motors  GM.N  and supplies the U.S. Department of Defense. 

    LESS COMMON METALS
    UK-based Less Common Metals produces rare earth
metals/alloys from its base in northern England and is part of
the European Supreemo project to establish a European rare
earths value chain. 
    
    REETEC 
    REEtec in Norway, backed by Swedish miner LKAB, is building
a commercial rare earth separation plant due to come into
production in 2025. It is in discussions with companies to
provide concentrate for the plant. 
       
    ILUKA
    Australian mineral sands producer Iluka Resources  ILU.AX 
is building its Eneabba rare earths refinery in the country's
northwest that will process heavy rare earths from its own mines
and from third parties like Northern Minerals  NTU.AX .
Commissioning is expected at the end of 2026. Iluka has been
awarded an A$1 billion ($660 million) loan from the Australian
government for what will be Australia's first fully integrated
rare earths refinery. 
  
    POSCO, STAR GROUP
    South Korea's Posco International  047050.KS  will provide
permanent magnets produced by Star Group to German and U.S.
automakers from 2025, sourced from the U.S., Australia and
Vietnam. Privately held Star Group is the sole manufacturer of
rare earth permanent magnets in South Korea.   
        
    JAPAN
    Japan has a well developed magnet market that supplies its
automotive and high tech industries. Among the biggest producers
are Shin-Etsu Chemical  4063.T , TDK Corp  6762.T  and
Proterial.
    
    VTRE
    Vietnam rare earth processor VTRE, which had partner
agreements with Australian rare earth developers Blackstone
Minerals  BSX.AX  and Australian Strategic Materials  ASM.AX , 
suspended production late last year after its chairman was
arrested for violating mining regulations. 
    
    NEO PERFORMANCE MATERIALS
    Toronto-listed Neo Performance Materials  NEO.TO  produces
rare earth oxides, magnetic powders and permanent magnets. It
has facilities around the world including in China, the U.S.,
Germany, Canada, Thailand and the UK. It plans to launch a new
permanent magnet plant in Estonia next year. 
     
    SASKATCHEWAN RESEARCH COUNCIL
    Canada's Saskatchewan Research Council received C$31 million
 ($22.57 million) in government funding to build a rare earths
processing plant. It has a supply agreement with Vietnam's Hung
Thinh Group (HTG) to import up to 3,000 tons of rare earth
carbonate per year for five years beginning in June 2025.
    
    UCORE
    Canada's Ucore Rare Metals  UCU.V  is building a heavy and
light rare earths separation facility in Louisiana set to come
online in late 2025.
    
    RAINBOW RARE EARTHS
    Rainbow Rare Earths  RBWR.L , backed by Dublin-based private
investment firm TechMet, has begun a rare earth oxide separation
process at a K-Technologies facility in Florida for rare earths
carbonate that it aims to produce from its Phalaborwa project in
South Africa. 
    
    MP MATERIALS
    MP Materials  MP.N  is building a rare earth magnet
manufacturing facility in Texas, helped with $58.5 million in
government funding. It currently ships rare earth concentrate to
China, although it started to produce some rare earth oxides at
its California mine site earlier this year. The company expects
to be producing finished magnets by late 2025 which it will
supply to General Motors  GM.N . It reported a wider than
expected loss in the first quarter due to weak rare earth
prices. 
     
    ENERGY FUELS
    Energy Fuels  UUUU.A , a U.S. producer of uranium and rare
earth elements, said on June 10 it had started to produce
commercial quantities of separated rare earths at its Utah
operations, where it expects to produce up to 1,000 tons of
neodymium-praseodymium a year.     
    
    FIEMG
    Brazil's state of Minas Gerais Federatio of Industries
(FIEMG) is building a proof-of-concept magnet factory set to
open in the second half of this year that will have capacity to
produce 100 tons of magnets a year when at full capacity.  
    
    
($1 = 1.3737 Canadian dollars, 1.5147 Australian dollars)

 (Reporting by Melanie Burton in Melbourne and Fabio Teixeira in
Rio De Janeiro. Additional reporting by Yuka Obayashi in Tokyo,
Eric Onstad in London, Francesco Guarascio in Hanoi and Ernest
Scheyder in Houston; Editing by Sonali Paul)
 ((melanie.burton@thomsonreuters.com Twitter: @MelanieMetals;
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