Lower prices spur rare earths consumption, supply remains constrained – USGS

14th February 2015

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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TORONTO (miningweekly.com) – Lower rare earths prices and the increased availability of rare-earth compounds led to increased US consumption in 2014, the US Geological Survey (USGS) has found.

However, in its latest mineral commodity summary for the abundant group of 17 elements composed of scandium, yttrium and the lanthanides, the USGS noted that increased domestic output of separated rare-earth products was hampered by technical difficulties in the ramp up of new production capacity.

Despite increased global demand for rare earths in the permanent magnet and catalyst industries, prices for most rare-earth compounds declined in 2014 owing to an excess of inventory in the market, the organisation said.

A Chinese export clampdown prompted a rapid spike in prices in 2010/11. However, the global economic crisis and a flood of new supplies resulted in the subsequent collapse of prices in 2013. Prices had now stabilised and were expected to remain so in the long term.

The USGS said global rare earths consumption was expected to grow at a compound yearly rate of more than 5% from 2014 until 2020.

China continued to dominate the global rare earths supply. In 2014, China’s rare-earth export quotas were 31 000 t, including 27 383 t for light rare earths and 3 617 t for heavy rare earths.

In August, the World Trade Organisation upheld a ruling in favour of the US, the European Union and Japan’s claims that China violated trade rules owing to unfairly imposing export restrictions on rare earths despite the country’s claims that the controls were aimed at protecting the environment and conserving resources.

In 2014, China continued efforts to consolidate its rare earths industry and clamp down on illegal production and exports. Simultaneously, China’s State Bureau of Material Reserve continued to expand its stockpile of rare earths.

Rare earths were relatively abundant in the earth’s crust, but discovered minable concentrations were less common than for most other ores. The US and other world resources were mainly contained in bastnäsite and monazite. Bastnäsite deposits in China and the US constituted the largest percentage of the world’s rare earth economic resources, while monazite deposits constituted the second largest segment.

According to the USGS, most rare earths were used as catalysts, while metallurgical applications and alloys, permanent magnets, glass polishing and others accounted for the rest of the minerals’ end-uses.

Rare earths consumption in the phosphor industry decreased owing to the increased use of light-emitting diode (LED) lighting, which required less rare earths than fluorescent lighting.

Last year, only Molycorp mined and produced rare earths in the US. The company mined Bastnäsite, a fluorocarbonate mineral, and processed it into concentrates and rare earth compounds at Mountain Pass, in California.

During the year, the US continued to be a net importer of rare earth products, with imports totalling $210-million, down year-on-year from $256-million imported in 2013.

In light of uncertainty regarding China’s continued dominance in the supply of rare earths, there were several rare earth projects under development outside of the country, which accounted for about 75% of the US’s imports.

Exploration and development assessments in the US included Bear Lodge, in Wyoming, Bokan Mountain, in Alaska, Diamond Creek, in Idaho, Elk Creek, in Nebraska, La Paz, in Arizona, Lemhi Pass, in Idaho/Montana, Pea Ridge, in Missouri, Round Top, in Texas, and Thor, in Nevada.

Other projects were under way in Australia, Brazil, Canada, China, Finland, Greenland, India, Kyrgyzstan, Madagascar, Malawi, Mozambique, Namibia, South Africa, Sweden, Tanzania, Turkey and Vietnam.

The US reserves were revised to include only those reserves compliant with recognised standards, which resulted in a large reduction in the US reserves reported in 2015 compared with previous years.

Domestic reserves included an estimated 1.5-million tons at Mountain Pass that were compliant with the Securities and Exchange Commission’s Industry Guide 7 and 390 000 t of reserves at the Bear Lodge deposit, which were compliant with Canada’s National Instrument 43-101 standard. The reserves reported for other countries would transition to stricter standards as better information became available, the USGS said.

The US government did not hold any rare earths in stockpiles.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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