The global Rare Earth Elements market size is projected to reach USD 3757.7 Million by 2026, from USD 2664.5 Million in 2020, at a CAGR of 5.9% during the Period 2021-2026. Permanent magnets, which are used in wind turbines, and certain types of batteries, which are used to power electric vehicles, are among two of the products, that use rare earths. Neodymium and praseodymium are majorly used for producing permanent magnets used in electric and hybrid vehicles. Availability of reliable raw material sources would naturally inspire setting up of downstream industries of refining, value addition, manufacture of rare earth permanent magnets, and other high value and high technology products.
Rare earth elements (REE), found in abundance is a group of 17 metals few of them are Cerium, Dysprosium, Erbium, Europium, Gadolinium, Holmium, Lanthanum, Lutetium, Neodymium, Praseodymium for instance. Cerium is used as a catalyst in catalytic converters in the automotive industry to minimize emissions. It’s also present in nickel-metal hydride (NiMH) batteries. Rare earth elements are bound together in different mineral types; can be extracted, separated and refined for different usage. These elements are light rare earths and heavy rare earths, with the heavy elements fetch higher market prices. The elements are used to produce smartphones, digital cameras, flat-screen TVs, computer hard disks, LED lights, computer monitors, and other devices that have grown in use over the past several decades. They are also used in clean energy products, such as solar panels and wind turbines.
India has good prospects in this category and can be a major supplier in the global REE supply chain. According to a US Geological Survey report, China has about 37% of known global REE reserves but produces about 60% of global REE. China has global dominance in REE mining; processing, value addition technologies as well as global REE supply lines. China’s capacity and willingness of using REE towards attaining its strategic objectives has the global community concerned. Its metallurgical manufacturing capacity and rare earth supply is in dominance.
India has about 6% of global REE reserves and produces a miniscule 1% of global supply. The increase in production can well be a fit Atmanirbharta project. Reliable domestic supply of these products would be a major addition to high industries such as electronics, defense, electric vehicles, and many others. The demand for rare earths is likely to increase is because of the usage in defense applications, lasers, jet engines, satellites etc.
Large tracts of the Indian Ocean coastline from East Africa to Myanmar, Thailand, Indonesia, and Australia are also host to rich REE containing mineral sands. These sands are enriched in REEs through constant weathering and attrition of REE rich rocks over millions of years. In the Indian Ocean Region, the mineral industry largely exists in the private sector while the governments prefer to stay in a regulatory role. REEs therefore, would largely be explored, mined, processed, and developed in the private sector, with inventory and exploration rights into their hands.
Global shift towards clean energy with rising demand for electric and hybrid vehicles is propelling the growth of a rare market. It is expected that the growing demand for electric vehicles to minimize carbon-dioxide emissions would also propel the growth of rare earth elements market size.
