Rare Earth Elements (REEs) are essential components of carbon-neutral technologies like wind turbines, batteries and electric vehicles - but are only found in low concentrations within minerals, making extraction more challenging.
Lynas and MP Materials are working hard to increase domestic processing and magnet production capabilities; however, Chinese competitors present formidable opposition.
Rare Earth Elements (REEs) are an alloy of seventeen metals with unique fluorescent, conductive, and magnetic properties that make them essential components in high-tech consumer products and industrial processes. Used to increase magnetic strength in permanent magnets for instance; REEs are also important components in electric vehicles, flat screen monitors/TVs and defense applications.
REEs are found in various mineral deposits, such as rare-earth oxides bastnasite and monazite. These soft heavy metals can be found relatively abundantly throughout Earth's crust; cerium, praseodymium and neodymium all occur at concentrations greater than 60 parts per million while lutetium and thulium occur much less commonly; typically no more than several hundred parts per million are ever detected.
Although other substances can serve as replacements for rare earth elements in certain applications, their use ultimately decreases both quality and utility of products containing REEs; consequently, demand is expected to skyrocket over the coming decades.
Green technology has seen a resurgence, driving demand for many products that use REEs - such as electric and hybrid vehicles which require neodymium magnets and dysprosium in their batteries; wind power will create further demand for REEs in its turbines and generators.
REEs are used in various applications, such as catalysts, phosphors and polishing compounds. Catalysts may help reduce air pollution; erbium phosphors brighten electronic screens; polishing compounds are needed to produce optical-quality glass - these uses all are expected to experience explosive growth as the global economy shifts towards cleaner energy models.
China holds a dominant market position for rare earths (REEs), producing 85% of refined REEs in 2020. But new reserves in Australia and the U.S. are beginning to reduce China's share of this global market, while pollution reduction efforts by local Chinese producers may drive some factories abroad with better environmental standards.
https://www.ilpost.it/2011/04/11/il-problema-con-le-energie-rinnovabili/
Neodymium, dysprosium, praseodymium and terbium are four rare earth metals essential to modern technology. Their magnetic components are used in industrial robots, hybrid and electric vehicles, wind turbines and advanced medical X-ray machines; additionally they help create green technologies to help mitigate greenhouse gas emissions and slow climate change.
Rare elements drive their high price and strong demand, creating attractive long-term return potential for investors. Furthermore, these elements are highly durable and reusable so their value won't diminish over time; making them an invaluable addition to any alternative investments portfolio.
However, mining and extraction of these metals may cause environmental damage when undertaken in countries with lax environmental standards. Dumping toxic waste in waterways could harm wildlife populations; mining activities could contribute to air pollution affecting human health - leading investors away from investing in rare earth miners as sustainable investments.
VanEck Vectors Rare Earth/Strategic Metals UCITS ETF (REMX) provides one of the most effective and sustainable strategies for investing in rare earth metals, holding stocks from various companies involved with production of these materials.
One major challenge lies with China being the primary producer of rare earth metals and working to restrict their export. As a result, some electric vehicle manufacturers like Tesla are moving away from using these materials which could lead to supply shortages in future.
However, these metals will continue to play an essential role in global economies worldwide. With hybrid and electric vehicle use increasing rapidly and batteries made of magnets requiring rare earths needed for hybrid/EV batteries being produced from cleaner energy sources like wind turbines motors being manufactured using them, as well as developments of medical X-ray machines, nuclear magnetic resonance devices and oil refineries all requiring rare earths for production of rare earth magnets, this means rare earth investments will continue to provide opportunities to diversify your portfolio and may prove lucrative investments!
Rare earth elements - which include terbium, praseodymium, dysprosium and neodymium - are critical components for high-tech applications like 5G mobile communications standards and modern X-ray technology as well as green products like rechargeable batteries and wind turbines. Their prices can fluctuate due to demand/supply fluctuations.
One way of investing in REEs is through purchasing shares in a mining company that extracts them, but be wary that share prices of rare earth mining companies may differ significantly from their production's spot price, making it hard to accurately gauge return potential and accurately project any returns on an investment.
An alternative strategy would be to invest in REE-related stocks that lie further along the supply chain, such as those which recycle them. Companies like Metal Tech Recycling Corp and American Resources Corp offer this type of exposure while helping mitigate supply disruption risk.
Investors can also gain access to rare earths via exchange-traded funds (ETFs), which track market indexes and trade like individual stocks. One such ETF, AuAg Essential Metals Fund, gives investors exposure to companies extracting metals such as neodymium, praseodymium and dysprosium while offering efficient cost-effective trading and liquidity services - just like any ETF would.
While investing in rare earths may appear risky, it can actually be an excellent way to diversify your portfolio. Their unique properties make them in high demand, promising significant future growth potential and limited production that could yield significant profits for companies involved in manufacturing or distribution.
On the ASX, there are over 30 REE stocks listed from micro to large cap companies that specialise in exploration and development of rare earths reserves; most are focused on exploring rare earth reserves for further development with market capitalisations below $100 million, making them an appealing investment option for smaller investors. It's essential to carefully consider environmental risks when selecting your ASX rare earths stock though!
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There's more than meets the eye when it comes to the world of "I want my money back". In a sense, he was right - the number of "I want my money back" claims has grown immensely over time. Rare earth elements (REEs) play an integral part in many industries, from consumer electronics such as Apple AirPods and iPhones to green technologies like General Electric wind turbines and Tesla electric cars, medical tools like Philips healthcare scanners, as well as military hardware like F-35 jet fighters. Given their relative scarcity, essential materials have become expensive commodities that command high prices; consequently, their supply has attracted immense political and economic scrutiny. China now controls most of the global supplies and has hinted at using this as leverage during trade talks with the U.S. President Xi Jinping has suggested using this position as leverage against his adversary, President Donald Trump. Experts acknowledge that China could continue exporting rare earth minerals without being exporters themselves; this situation reveals a larger danger: any one country can exert considerable control over certain industry sectors by restricting access to critical resources.
As such, many companies that rely on rare earths are seeking alternatives to mining altogether. Oil refineries for instance have since 2010 stopped using the rare earth element lanthanum which improves oil refining processes, due to supply constraints; glassmakers also no longer rely on cerium which was essential in polishing glass; in addition, manufacturers have started employing recycled versions of such materials in production processes.
Although these efforts can help mitigate demand and supply risks, their implementation takes time and may not ensure an uninterrupted supply of raw materials needed for energy transition technologies. Given this situation, regular market assessments and stress tests, along with strategic stockpiling measures become even more essential.
Energy transition metal demand trajectories are highly uncertain and depend heavily on technical and policy decisions that could quickly shift, with cobalt demand likely increasing from six-to-thirty-fold by 2040, depending on battery type used, while rare earth elements could experience sevenfold growth depending on deployment mix, climate policies and deployment strength. Our analysis indicates this.