Uncertain Rare Earth Supplies Planting a Question Mark over the growth of the Hybrid Vehicle market

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Hybrid vehicles largely depend upon four rare earth elements – Praseodymium, Neodymium, Terbium, and Dysprosium. Out of these four elements, the later three are expected to face a critical supply crunch in the near future.

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Uncertain Rare Earth Supplies Planting a Question Mark over the growth of the Hybrid Vehicle market

  1. 1. Uncertain Rare Earth Supplies Planting a QuestionMark over the growth of the Hybrid Vehicle marketHybrid vehicles largely depend upon four rare earth elements – Praseodymium, Neodymium, Terbium,and Dysprosium. Out of these four elements, the later three are expected to face a critical supply crunchin the near future.The market for hybrid vehicles is currently witnessing rapid growth with analysts expecting theirdemand to grow several folds during 2011-2015. The extensive adoption of these vehicles can beattributed to a number of factors. These include: a growing awareness among end users,government support, rapid technological advancements and a continuous increase in oil prices.Question marks, however, are currently hanging over the future growth of these vehicles – atleast in the short term. A new study from IMARC Group, one of the worlds’ leading researchand advisory firms entitled “The Global Rare Earth Elements Market 2011-2015: Is theHype Justified?” finds that hybrid vehicles largely depend upon four rare earth elements –Praseodymium, Neodymium, Terbium, and Dysprosium. Out of these four elements, the laterthree are expected to face a critical supply crunch in the near future.Findings from the report suggest that NdFeB magnets are the enabling technology for today’selectric vehicles. The commonly used rare earth magnets of today combine 31% Neodymiumwith 68% Iron and 1% Boron. However, these magnets when used in hybrid vehicles have to bealloyed with up to 4.5% of Dysprosium by weight that dramatically improves its temperaturehandling capability. Terbium, even though more expensive and a lot rarer than dysprosium, canalso accomplish the same thing. Praseodymium may also added to the magnet to enhance itsfield strength. The report expects that the demand of NdFeB magnets is expected to growexponentially with an increasing demand of hybrid vehicles. This in turn is expected to drive theconsumption of the rare earth elements - Neodymium, Praseodymium, Dysprosium and Terbiumin the coming years.Findings from the report also suggested that NdFeB magnet manufacturers are heavily dependentupon China for their rare earth supplies. In 2010, China accounted for 99% of the global Terbiumproduction, 98% of the global Praseodymium production and 97% of both Neodymium andDysprosium production. As a result of its increasing domestic demand, the Chinese governmentin recent years has significantly restricted the export of these elements. For instance, betweenMay 2010 and August 2011, the domestic prices for Neodymium in China increased eightfold,this resulted in the Chinese government decreasing its export quota and ramping up its exporttaxes on rare earths leading to sky rocketing prices and a shortage of rare earth elements for therest of the world.Supply demand projections from the report suggest that with the opening of a number of non-Chinese mines during 2011–2015, the production of these four rare earth elements will
  2. 2. significantly increase and diversify. However, excluding Preseodymium which is expected to beoversupplied by 17%, the report expects the demand of Dysprosium, Terbium and Neodymiumto outpace their total supply by 71%, 10% and 9% respectively by 2015. The report suggests thatthe shortage of these three rare earth elements may have a major impact on the growth of thehybrid car market as they have limited substitutes and recycling options.IMARC’s new report entitled “The Global Rare Earth Elements Market 2011-2015: Is the HypeJustified?” provides an analytical and statistical insight into the global rare earth elementsmarket. The study that has been undertaken using both desk-based as well as qualitative primaryresearch has analyzed five aspects of the rare earth elements market.Key Aspects Analyzed in this Report:Understanding the Mining Economics of Rare Earth Elements:Focus of the Analysis: Rare earth mine valuation Stages and time taken to develop and start production at a rare earth mine The total costs involved in rare earth mining Mining and downstream processing of rare earth elements Rare earth element pricingUnderstanding China’s Role in the Global Rare Earth Elements Market:Focus of the Analysis: China’s role in the global supply and demand of rare earth elements Reasons for China’s dominance China’s current and future supply strategiesComprehensive Situation Analysis of the Global Rare Earth Elements Market:Focus of the analysis: Quantifying the historical sales and production of rare earth elements Identification and evaluation of current global rare earth mines Identification and evaluation of mines expected to begin production in the next five years Current and future consumption of rare earth elementsEvaluating the Supply and Demand of Various Rare Earth Elements:
  3. 3. Focus of the analysis: Quantifying the production of each element from current and future mines Quantifying the current and future demand of each element Historical, current and future prices of each element Evaluating the supply risks of each element and its importance for clean technology Identification of critically undersupplied and oversupplied rare earth elementsInformation Sources:Information has been sourced from both primary and secondary sources: Primary sources include industry surveys and face to face/telephone interviews with industry experts. Secondary sources include proprietary databases and search engines. These sources include company websites and reports, books, trade journals, magazines, white papers, industry portals, government sources and access to more than 4000 paid databases.To buy the complete report or to get a free sample:Call: +91-120-425-6531 (Asia) +1-631-791-1145 (America)Email: sales@imarcgroup.comTo know more please visit:http://www.imarcgroup.com/the-global-rare-earth-elements-market-2011-2015-is-the-hype-justified/For more information, visit: http://www.imarcgroup.comKey wordRare earth elements, rare earth metals, rare earth metal stocks, rare earth element stocks, rareearth metal market, rare earth element market

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