Rare earth alloys are very important for all kinds of modern electronics, especially electric vehicles. The production of rare earth alloys is 90% controlled by China. That is changing, but prices will go up in the meantime.
Rare Earth Elements in Electric Vehicles
Rare earth alloys are also called rare earth elements - REE. REE are used in all things technical from lasers to coloring agents and DVD players.
EVs use a few REE too. The biggest uses are in EV battery motors and battery packs. Each new Prius for instance uses about 25 pounds of rare earths.
The Toyota Prius and hybrids using nickel-metal hydride battery packs and neodymium magnets in their electric motors use the most REE. Currently, Prius motors use about 1 kg (2.2 lb) of neodymium, and their battery packs take around 10 to 15 kg (22-33 lb) of lanthanum.
However, Toyota has take the lead with respect to electric vehicle motor technology. The company has designed for production a motor that uses no rare earths. The Nissan Leaf, among other EVs such as the 1st generation Ford Ranger EVand RAV4 EV, also do not use rare earths in their AC Induction motors.
So, many EVs can get down the road minus REE. This has been verified by at least one independent inventor. One Professor Nobukazu Hoshi from the Tokyo University of Science has built an electric car requiring zero REE.
The Soil Embargo
It happens that REE are not really all that rare, just not all that produced.
China currently has a short term monopoly on production and therefore distribution. Like the 1973 Arab Oil Embargo, China controls critical resources...a soil embargo.
China lowered the price of REE to the point where it was not cost effective to mine the materials elsewhere. Now that the demand is increasing, China owns the market.
However, unlike the oil embargo, the soil embargo will be limited. There are plenty of rare earth reserves in the USA, for instance. Although some of the mining sites are difficult to access, they can be brought back into production.
China currently controls over 90% of the world's rare earth element production. They cut production by 2/3 at the end of last year, and another 1/3 in first half of 2011. The price for some rare earths has therefore already doubled.
Technical Impacts
There are plenty of reserves of the elements, but ramping up for production will take about 10 years or so.
Presently about 100,000 tons of REE are produced annually. The demand is forecast to nearly double in the next few years.
World reserve estimates of rare earth elements is estimated by the USGS to be around 150,000,000 tons. The crunch is in the years it will take to set up production.
New Production
Some REE processing facilities have closed in recent years due to both economic and environmental problems. REE mining produces important metals, but it also produces toxic waste water.
Industry is responding to the need to open new REE mining facilities. The company currently moving much of the REE supply in the westerm US is Molycorp. They are awaiting environmental permits to reopen their open pit mine at Mountain Pass Ca.
The Mountain Pass facility could provide up to 1/4 of the worlds REE needs. Molycorp has invested several hundred US dollars to reopen the facility soon.
Another prospect in development is the Canadian Thor Lake site in the Northwest Territories.
In Washington County, Missouri, the Pea Ridge facility is ramping up for secondary production of REE from previous mine tailings. New mining in the area could produce several thousand tons per year within the next few years.
