The rare earth metals market comprises rare earth oxides, metals, alloys, and magnets that are vital for manufacturing electronics, magnets, metallurgical applications, polishing powders, catalysts, phosphors and colored glass. Advancements in clean energy technologies have bolstered the significance of rare earth metals in production of high-performance batteries, electric vehicles, wind turbines and energy-efficient lights.
The Global Rare Earth Metals Market is estimated to be valued at US$ 5,648.83 Mn in 2024 and is expected to exhibit a CAGR of 6.2% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the rare earth metals market are China Northern Rare Earth (Group) High-Tech Co., Ltd, Rising Nonferrous Metals Co., Ltd, China Minmetals Rare Earth Co., Ltd, Aluminum Corporation of China Limited, Lynas Corporation, Ltd., Beijing Zhongke Sanhuan High-tech Co. Ltd., Jiangxi Tungsten Industry Group Co. Ltd., Arafura Resources Ltd., Alkane Resources Ltd. Growing demand from clean energy technologies has majorly attributed to the global rare earth metals market value. The market is witnessing increased adoption of rare earth metals in manufacturing of batteries, magnets, auto catalysts and energy-efficient lighting.
Geopolitical issues surrounding rare earth supply chain have prompted companies to seek diversification and establish secondary sources of Rare Earth Metals Market Growth outside China. Leading economies are expanding rare earth mining and processing capacities to secure critical material supply.
Market key trends
The increasing emphasis on sustainability and electrification of automobiles are majorly influencing the rare earth metals market trends. With rising EV sales worldwide, the demand for rare earth magnets in motor and batteries is projected to observe robust growth between 2024 to 2031. Countries are raising incentives for electric vehicles to curb vehicular emissions, thereby augmenting the rare earth requirement for automotive applications. The trend is likely to gain further traction through 2031.
Porter’s Analysis
Threat of new entrants: The rare metals industry requires significant capital investment and has regulations around mining and processing rare earth metals. This poses high barriers to entry for potential new companies.
Bargaining power of buyers: Individual buyers have relatively low bargaining power in the global rare earth metals market due to its oligopolistic industry structure with few major suppliers controlling most of the market share.
Bargaining power of suppliers: A small number of companies, mainly Chinese firms, control the majority of rare earth metals supply globally. This gives suppliers significant bargaining power over buyers in the industry.
Threat of new substitutes: While some substitutes exist for individual rare earth metals, there are no close substitutes for the group of rare earth metals as a whole given their unique chemical and physical properties.
Competitive rivalry: Competition is intense among the top companies due to similarities in production capabilities and scarcity of rare earth metal reserves. Companies compete based on capacity expansions and vertical integration.
Geographical regions: China dominates the global rare earth metals market in terms of value, accounting for an estimated 85% of production as of 2022. Main rare earth reserves are located in China, the United States, Australia, among others.
The Asia Pacific region excluding China is expected to be the fastest growing regional market for rare earth metals between 2024-2031 due to increasing demand and production from countries like India and Japan. Japan is a major consumer of rare earth metals and India has sizeable rare earth reserves.
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About Author:
Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemical and materials, defense and aerospace, consumer goods, etc. (https://www.linkedin.com/in/money-singh-590844163)
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