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Rare Earths

Rare Earths


Rare earth/strategic metals are industrial metals that are typically mined as by-products in operations focused on precious metals and base metals. Compared to base metals, they have more specialized uses and are often more difficult to extract. Currently, approximately 49 elements in the periodic table are considered rare earth/strategic metals. They include such elements as cerium, manganese, titanium and tungsten. Strategic metals are used in a variety of technologies including jet engines, hybrid cars, steel alloys, wind turbines, flat screen televisions and cellular phones.

Rare earth metals are a subset of strategic metals, a collection of 17 chemical elements in the periodic table that are essential in many of today's most advanced technologies, with particular applications in electronics. The International Union of Pure and Applied Chemistry ("IUPAC") defines rare earth elements ("REEs") or rare earth metals ("REMs") specifically as the 15 lanthanides plus scandium and yttrium. Scandium and yttrium are considered rare earth elements since they tend to occur in the same ore deposits as the lanthanides and exhibit similar chemical properties.

Despite their name, rare earth elements (with the exception of the radioactive promethium) are relatively plentiful in the Earth's crust, with cerium being the 25th most abundant element at 68 parts per million (similar to copper). However, because of their geochemical properties, rare earth elements are typically dispersed and not often found in concentrated and economically exploitable forms.

The few economically exploitable deposits are known as rare earth minerals. It was the very scarcity of these minerals (previously called "earths") that led to the term "rare earth". The first such mineral discovered was gadolinite, a compound of cerium, yttrium, iron, silicon and other elements. This mineral was extracted from a mine in the village of Ytterby in Sweden; several of the rare earth elements bear names derived from this location.

REE Table


This REE table orders the 17 rare earth elements by their atomic number (Z), with the chemical symbol (Sym), name etymology, main usages and technological applications. Some rare earths are named for the scientists who discovered or elucidated their elemental properties, and some for their geographical discovery.

ZSymNameEtymologySelected Applications
21
Sc
Scandiumfrom Latin Scandia(Scandinavia), where the first rare earth ore was discovered.Light aluminium-scandium alloy for aerospace components, additive in Mercury-vapor lamps.
39
Y
Yttriumfor the village of Ytterby, Sweden, where the first rare earth ore was discovered.Yttrium-aluminium garnet (YAG) laser, yttrium vanadate (YVO4) as host for europium in TV red phosphor YBCO high-temperature superconductors, yttrium iron garnet (YIG) microwave filters.
57
La
Lanthanumfrom the Greek "lanthanein", meaning to be hidden.High refractive index glass, flint, hydrogen storage, battery-electrodes, camera lenses, fluid catalytic cracking catalyst for oil refineries
58
Ce
Ceriumfor the dwarf planet Ceres, named after the Roman goddess of agriculture.Chemical oxidizing agent, polishing powder, yellow colors in glass and ceramics, catalyst for self-cleaning ovens, fluid catalytic cracking catalyst for oil refineries, ferrocerium flints for lighters
59
Pr
Praseodymiumfrom the Greek "prasios", meaningleek-green, and "didymos", meaningtwin.Rare-earth magnets, lasers, core material for carbon arc lighting, colorant in glasses and enamels, additive in didymium glass used in welding goggles, ferrocerium firesteel (flint) products.
60
Nd
Neodymiumfrom the Greek "neos", meaningnew, and "didymos", meaning twin.Rare-earth magnets, lasers, violet colors in glass and ceramics, ceramic capacitors
61
Pm
Promethiumfor the Titan Prometheus, who brought fire to mortals.Nuclear batteries
62
Sm
Samariumfor Vasili Samarsky-Bykhovets, who discovered the rare earth ore samarskite.Rare-earth magnets, lasers, neutron capture, masers "Microwave Amplification by Stimulated Emission of Radiation"
63
Eu
Europiumfor the continent of Europe.Red and blue phosphors, lasers, mercury-vapor lamps, NMR "Nuclear Magnetic Resonance" relaxation agent
64
Gd
Gadoliniumfor Johan Gadolin (1760-1852), to honor his investigation of rare earths.Rare-earth magnets, high refractive index glass or garnets, lasers, X-ray tubes, computer memories, neutron capture, MRI "Magnetic Resonance Imaging" contrast agent, NMR relaxation agent
65
Tb
Terbiumfor the village of Ytterby, Sweden.Green phosphors, lasers, fluorescent lamps
66
Dy
Dysprosiumfrom the Greek "dysprositos", meaning hard to get.Rare-earth magnets, lasers
67
Ho
Holmiumfor Stockholm (in Latin, "Holmia"), native city of one of its discoverers.Lasers
68
Er
Erbiumfor the village of Ytterby, Sweden.Lasers, vanadium steel
69
Tm
Thuliumfor the mythological northern land of Thule.Portable X-ray machines
70
Yb
Ytterbiumfor the village of Ytterby, Sweden.Infrared lasers, chemical reducing agent
71
Lu
Lutetiumfor Lutetia, the city which later became Paris.PET Scan detectors, high refractive index glass

Abbreviations


The following abbreviations are often used:

  • RE = rare earth
  • REM = rare earth metals
  • REE = rare earth elements
  • REO = rare earth oxides
  • REY = rare earth elements and yttrium
  • LREE = light rare earth elements (La-Eu, atomic #s 57-62; also known as the cerium group include: Lanthanum, Cerium, Praseodymium, Neodymium, Promethium and Samarium)
  • HREE = heavy rare earth elements (Gd-Lu and Y, atomic #s 63-71; also known as the yttrium group include: Europium, Gadolinium, Terbium, Dysprosium, Holmium, Erbium, Thulium, Ytterbium and Lutetium)

It's common to confuse "Rare Earths", "Rare Earth Elements" and "Rare Earth Metals", depending on whether your classification of "Rare" is based on chemical or economic criteria. If chemical, this just refers to the 17 REEs listed above; otherwise it also includes these rare metals:

Platinum, Palladium, Rhodium, Iridium, Osmium, Ruthenium, Molybdenum, Manganese, Vanadium, Rubidium, Chromium, Lithium, Thorium, Hafnium, Gallium, Germanium, Indium, Cesium, Beryllium, Zirconium, Niobium, Tantalum, Titanium, Tin, Uranium

Growing uses include lithium or vanadium in batteries, tantalum in your cellphone, neodymium in hybrid cars, tungsten to harden steel tools, Praseodymium and others in lasers, magnets or to color glass or enamel, plus many more.

REE Prices


Rare earth elements are not exchange-traded (as physical bullion or on futures markets) like precious metals (i.e. gold, silver and platinum) or non-ferrous metals (i.e. copper, nickel, tin, and aluminium) are traded. Instead they are sold on the private market, which makes their prices difficult to monitor and track. However, prices are published periodically on websites such as mineralprices.com. The 17 elements are not usually sold in their pure form, but instead are distributed in mixtures of varying purity, e.g. "Neodymium metal ≥ 99.5%". As such, pricing can vary based on the quantity and quality required by the end user's application.

Rare Earth Companies


United States

  • Molycorp (NYSE: MCP), the Denver-based company that bought the Mountain Pass mine in 2008 from Chevron, has ambitious plans to retool the facility and resume mining and processing of 20,000 tonnes of rare earths by 2012, up from its current level of 2,000 tonnes per year. As the only company in the United States with existing infrastructure and proven reserves, Molycorp could be the first to significantly expand rare earth mining and processing in the U.S. The company was listed on the New York Stock Exchange in July 2010, although it has not made a profit since acquiring the Mountain Pass mine and may lose money for 2 more years before becoming profitable.
  • Market Vectors Rare Earth/Strategic Metals ETF (NYSE: REMX) tracks a basket of 24 companies involved in the mining, refining and recycling of REMs, including a 5% allocation to Molycorp. The ETF is also geographically diversified, with 10% of assets allocated to Japan, 20% to Australia and 11.6% to China. It also includes an 11.2% allocation to Africa, with the remaining assets spread across North and South America.

Canada

  • Avalon Rare Metals (TSE: AVL) is a Toronto-based company currently developing the Thor Lake mine in Northwest Canada, which - according to the company - is rich in neodymium and heavy rare earths.
  • Neo Material Technologies (TSE: NEM) is a Toronto-based company that shifted its Magnequench division specializing in neodymium-based products to China in 2000. The company merged with Molycorp in 2012.
  • VMS Ventures (TSXV: VMS) is a Vancouver-based company that sold its Eden Lake complex in Central Manitoba, where rare earth metals were discovered in 2003, to Rare Element Resources on August 31, 2010.
  • Great Western Minerals (TSXV: GWG) is a Saskatoon-based company with 6 rare earth exploration and development properties in North America, and an option on an additional property in South Africa. The Hoidas Lake project in Northern Saskatchewan is - according to the company - North America's most advanced rare earth property in development and has the potential to supply 10% of North American demand.
  • Rare Element Resources (TSX: RES)(AMEX: REE) is a Vancouver-based company whose Bear Lodge property in Wyoming USA has significant deposits of both gold and rare earth elements.
  • Quantum Rare Earth Development (TSXV: QRE) is a Vancouver-based company that is currently conducting test drilling and economic feasibility studies toward opening a niobium mine in southeast Nebraska USA.

Australia

  • Alkane Resources (ASX: ALK)(FF: AK7) is a Perth-based company that owns the Dubbo Zirconia project in New South Wales. The mine has relatively large proportions of medium and heavy rare earths.
  • Arafura Resources (ASX: ARU)(FF: REB)(OTC: ARAFF) is a Perth-based company building a rare earth mine and processing plant at its Nolan project in the Northern Territory. It expects to start mining by 2013.
  • Lynas Corporation (ASX: LYC)(FF: LYI)(OTC: LYSCF) is a Sydney-based company building a rare earth mine at Mount Weld in Western Australia.
  • Peak Resources (ASX: PEK) is a Perth-based company that announced in February 2012 that their Tanzanian based Ngualla project contained not only the 6th largest deposit by tonnage outside of China, but also the highest grade of rare earth elements of those six deposits

China

Japan

  • Showa Denko (TYO:4004)(OTC: SHWDF) is a Tokyo-based company that has a 90%-owned subsidiary in Southeast Vietnam which produces didymium and dysprosium metals using rare earth oxides procured from inside and outside Vietnam. The company also produces rare earth magnetic alloys at its plants in Japan (Chichibu) and China (Inner Mongolia and Jiangxi).

India

Search to discover hundreds of small-cap REE, resource and non-resource stocks at InvestorsGuru.com's Small Cap Directory.

Discovery and Early History


Rare earth elements became known to the world with the discovery of the black mineral "ytterbite" (renamed to gadolinite in 1800) by Lieutenant Carl Axel Arrhenius in 1787, at a quarry in the village of Ytterby, Sweden.

Arrhenius' "ytterbite" reached Johan Gadolin, a Royal Academy of Turku professor, and his analysis yielded an unknown oxide (earth) which he called Ytteria. Anders Gustav Ekeberg isolated beryllium from the gadolinite but failed to recognize other elements which the ore contained. After this discovery in 1794 a mineral from Bastnäs near Riddarhyttan, Sweden, which was believed to be an iron-tungsten mineral, was re-examined by Jöns Jacob Berzelius and Wilhelm Hisinger. In 1803 they obtained a white oxide and called it ceria. Martin Heinrich Klaproth independently discovered the same oxide and called it ochroia.

Thus by 1803 there were two known rare earth elements, yttrium and cerium, although it took another 30 years for researchers to determine that other elements were contained in the two ores ceria and ytteria (the similarity of the rare earth metals' chemical properties made their separation difficult).

In 1839 Carl Gustav Mosander, an assistant of Berzelius, separated ceria by heating the nitrate and dissolving the product in nitric acid. He called the oxide of the soluble salt lanthana. It took him three more years to separate the lanthana further into didymia and pure lanthana. Didymia, although not further separable by Mosander's techniques was a mixture of oxides.

In 1842 Mosander also separated the ytteria into three oxides: pure ytteria, terbia and erbia (all the names are derived from the town name "Ytterby"). The earth giving pink salts he called terbium; the one which yielded yellow peroxide he called erbium.

So in 1842 the number of rare earth elements had reached six: yttrium, cerium, lanthanum, didymium, erbium and terbium.

Nils Johan Berlin and Marc Delafontaine tried also to separate the crude ytteria and found the same substances that Mosander obtained, but Berlin named (1860) the substance giving pink salts erbium and Delafontaine named the substance with the yellow peroxide terbium. This confusion led to several false claims of new elements, such as the mosandrium of J. Lawrence Smith, or the philippium and decipium of Delafontaine.

There were no further discoveries for 30 years...

More on Rare Earth Spectroscopy, Early Classification, Origin, Geological Distribution and Environmental Considerations at Wikipedia.

Global Rare Earth Production


Until 1948, most of the world's rare earths were sourced from placer sand deposits in India and Brazil. Through the 1950s, South Africa took the status as the world's rare earth source, after large veins of rare earth bearing monazite were discovered there. Through the 1960s until the 1980s, the Mountain Pass rare earth mine in California was the leading producer.

Today, the Indian and South African deposits still produce some rare earth concentrates, but they are dwarfed by the scale of Chinese production. China now produces over 95% of the world's rare earth supply, mostly in Inner Mongolia, even though it has only 37% of proven reserves. All of the world's heavy rare earths (such as dysprosium) come from Chinese rare earth sources such as the polymetallic Bayan Obo deposit. In 2010, the United States Geological Survey (USGS) released a study which found that the United States had 13 million metric tons of rare earth elements.

New demand has recently strained supply, and there is growing concern that the world may soon face a shortage of the rare earths. In several years from 2009 worldwide demand for rare earth elements is expected to exceed supply by 40,000 tonnes annually unless major new sources are developed.

China


These concerns have intensified due to the actions of China, the predominant supplier. Specifically, China has announced regulations on exports and a crackdown on smuggling. On September 1, 2009, China announced plans to reduce its export quota to 35,000 tons per year in 2010-2015, ostensibly to conserve scarce resources and protect the environment. On October 19, 2010 China Daily, citing an unnamed Ministry of Commerce official, reported that China will "further reduce quotas for rare earth exports by 30 percent at most next year to protect the precious metals from over-exploitation". At the end of 2010 China announced that the first round of export quotas in 2011 for rare earths would be 14,446 tons which was a 35% decrease from the previous first round of quotas in 2010. China announced further export quotas on 14 July 2011 for the second half of the year with total allocation at 30,184 tons with total production capped at 93,800 tonnes. In September 2011 China announced the halt in production of three of its eight major rare earth mines, responsible for almost 40% of China's total rare earth production.

Outside of China


As a result of the increased demand and tightening restrictions on exports of the metals from China, some countries are stockpiling rare earth resources. Searches for alternative sources in Australia, Brazil, Canada, South Africa, Tanzania, Greenland, and the United States are ongoing. Mines in these countries were closed when China undercut world prices in the 1990s, and it will take a few years to restart production as there are many barriers to entry. One example is the Mountain Pass mine in California, which is projected to reopen in 2011. Other significant sites under development outside of China include the Nolans Project in Central Australia, the remote Hoidas Lake project in northern Canada, and the Mount Weld project in Australia. The Hoidas Lake project has the potential to supply about 10% of the $1 billion of REE consumption that occurs in North America every year. Vietnam signed an agreement in October 2010 to supply Japan with rare earths from its northwestern Lai Châu Province.

Also under consideration for mining are sites such as Thor Lake in the Northwest Territories, various locations in Vietnam, and a site in southeast Nebraska in the US, where Quantum Rare Earth Development, a Canadian company, is currently conducting test drilling and economic feasibility studies toward opening a niobium mine. Additionally, a large deposit of rare earth minerals was recently discovered in Kvanefjeld in southern Greenland. Pre-feasibility drilling at this site has confirmed significant quantities of black lujavrite, which contains about 1% rare earth oxides (REO). Adding to potential mine sites, ASX listed Peak Resources announced in February 2012, that their Tanzanian based Ngualla project contained not only the 6th largest deposit by tonnage outside of China, but also the highest grade of rare earth elements of those six deposits.

In early 2011, Australian mining company, Lynas, was reported to be "hurrying to finish" a US$230 million rare earth refinery on the eastern coast of Malaysia's industrial port of Kuantan. The plant would refine ore - Lanthanide concentrate from the Mount Weld mine in Australia. The ore would be trucked to Fremantle and transported by container ship to Kuantan. However, the Malaysian authorities confirmed that as of October 2011, Lynas was not given any permit to import any rare earth ore into Malaysia. On February 2nd 2012, the Malaysian AELB (Atomic Energy Licensing Board) recommended that Lynas be issued a Temporary Operating License (TOL) subject to completion of a number of conditions. On April 3 2012, Lynas announced to the Malaysian media that these conditions had been met, and was now waiting on the issuance of the licence. Within two years, Lynas was said to expect the refinery to be able to meet nearly a third of the world's demand for rare earth materials, not counting China." The Kuantan development brought renewed attention to the Malaysian town of Bukit Merah in Perak, where a rare-earth mine operated by a Mitsubishi Chemical subsidiary, Asian Rare Earth, closed in 1992 and left continuing environmental and health concerns. In mid-2011, after protests, Malaysian government restrictions on the Lynas plant were announced. At that time, citing subscription-only Dow Jones Newswire reports, a Barrons report said the Lynas investment was $730 million, and the projected share of the global market it would fill put at "about a sixth." An independent review was initiated by Malaysian Government and UN and conducted by IAEA between 29 May and 3 June 2011 to address concerns of radioactive hazards. The IAEA team was not able to identify any non-compliance with international radiation safety standards.

Significant quantities of rare earth oxides are found in tailings accumulated from 50 years of uranium ore, shale and loparite mining at Sillamäe, Estonia. Due to the rising prices of rare earths, extraction of these oxides has become economically viable. The country currently exports around 3,000 tonnes per year, representing around 2% of world production.

Nuclear reprocessing is another potential source of rare earth or any other elements. Nuclear fission of uranium or plutonium produces a full range of elements, including all their isotopes. However, due to the radioactivity of many of these isotopes, it is unlikely that extracting them from the mixture can be done safely and economically.

In May 2012, researchers from two prevalent universities in Japan announced that they had discovered rare earths in Ehime Prefecture, Japan.

Recycling


Another recently developed source of rare earths is electronic waste and other wastes that have significant REE components. New advances in recycling technology have made extraction of rare earths from these materials more feasible, and recycling plants are currently operating in Japan, where there is an estimated 300,000 tons of rare earths stored in unused electronics. In France, the Rhodia group is setting up two factories, in La Rochelle and Saint-Fons, that will produce 200 tons a year of rare earths from used fluorescent lamps, magnets and batteries.

Geo-Political Considerations


China has officially cited resource depletion and environmental concerns as the reasons for a nationwide crackdown on its rare earth mineral production sector. However, non-environmental motives have also been imputed to China's rare earth policy. According to The Economist, "Slashing their exports of rare-earth metals...is all about moving Chinese manufacturers up the supply chain, so they can sell valuable finished goods to the world rather than lowly raw materials." One possible example is the division of General Motors which deals with miniaturized magnet research, which shut down its US office and moved its entire staff to China in 2006 (it should be noted that China's export quota only applies to the metal but not products made from these metals such as magnets).

It was reported, but officially denied, that China instituted an export ban on shipments of rare earth oxides (but not alloys) to Japan on 22 September 2010, in response to the detainment of a Chinese fishing boat captain by the Japanese Coast Guard. On September 2, 2010, a few days before the fishing boat incident, The Economist reported that "China...in July announced the latest in a series of annual export reductions, this time by 40% to precisely 30,258 tonnes."

The United States Department of Energy in its 2010 Critical Materials Strategy report identified dysprosium as the element that was most critical in terms of import reliance.

A 2011 report issued by the U.S. Geological Survey and U.S. Department of the Interior, "China's Rare-Earth Industry," outlines industry trends within China and examines national policies that may guide the future of the country's production. The report notes that China's lead in the production of rare-earth minerals has accelerated over the past two decades. In 1990, China accounted for only 27% of such minerals. In 2009, world production was 132,000 metric tons; China produced 129,000 of those tons. According to the report, recent patterns suggest that China will slow the export of such materials to the world: "Owing to the increase in domestic demand, the Government has gradually reduced the export quota during the past several years."

In 2006, China allowed 47 domestic rare-earth producers and traders and 12 Sino-foreign rare-earth producers to export. Controls have since tightened annually; by 2011, only 22 domestic rare-earth producers and traders and 9 Sino-foreign rare-earth producers were authorized. The government's future policies will likely keep in place strict controls: "According to China's draft rare-earth development plan, annual rare-earth production may be limited to between 130,000 and 140,000 [metric tons] during the period from 2009 to 2015. The export quota for rare-earth products may be about 35,000 [metric tons] and the Government may allow 20 domestic rare-earth producers and traders to export rare earths."

The United States Geological Survey is actively surveying southern Afghanistan for rare earth deposits under the protection of United States military forces. Since 2009 the USGS has conducted remote sensing surveys as well as fieldwork to verify Soviet claims that volcanic rocks containing rare earth metals exist in Helmand province near the village of Khanneshin. The USGS study team has located a sizable area of rocks in the center of an extinct volcano containing light rare earth elements including cerium and neodymium. It has mapped 1.3 million metric tons of desirable rock, or about 10 years of supply at current demand levels. The Pentagon has estimated its value at about $7.4 billion.

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