The rare earth metals find wide ranging applications in various modern-day technologies and industries owing to their unique magnetic and electrochemical properties. Rare earth metals are essential components of many electronic devices, permanent magnets, catalytic converters, rechargeable batteries, glass polishing, armor penetrators and medical applications such as MRI contrast agents. With the increasing penetration of consumer electronics, electric vehicles, wind turbines and various other green technologies, the demand for rare earth metals is experiencing progressive growth. The global rare earth metals market is highly reliant upon china for the raw material supply as china accounts for nearly 95% of global rare earth metal production. However, the growing trade tensions and supply chain disruptions have prompted nations to reduce dependence on china and boost domestic rare earth production.
The global Rare Earth Metals Market is estimated to be valued at US$ 4710.8 Mn in 2024 and is expected to exhibit a CAGR of 6.2% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Expansion of electric vehicle industry: Over the past few years, the electric vehicle sales have picked up significantly propelled by supportive government policies and initiatives towards adoption of eco-friendly transportation solutions. Electric vehicles extensively utilize rare earth metals in their rechargeable batteries and electric motors. The surging adoption of electric vehicles is generating strong demand for rare earth metals such as neodymium, praseodymium, and dysprosium which are important components of electric vehicle batteries and permanent magnets used in vehicle motors. According to estimates, a medium sized electric car requires around 15-30 lbs of rare earth metals. Thus, the rapid proliferation of electric vehicles worldwide is viewed as a major growth driver for rare earth metals market over the coming years.
- Threat of new entrants: The threat of new entrants is low as rare earth metals mining industry requires large capital investment and exploration and processing requires technical expertise.
- Bargaining power of buyers: The bargaining power of buyers is moderate as rare earth metals are widely used in several industries like automotive, consumer electronics, etc. However, substitutes exist for some applications.
- Bargaining power of suppliers: The bargaining power of suppliers is high as China dominates rare earth metals production.
- Threat of new substitutes: Substitutes exist for some applications which poses moderate threat. However, substitutes are limited for other strategic and defense applications.
- Competitive rivalry: The competitive rivalry is high among existing players due to dominance of key players and fluctuating supply-demand dynamics.
The global rare earth metals market is expected to witness high growth over the forecast period. The global Rare Earth Metals Market is estimated to be valued at US$ 4710.8 Mn in 2024 and is expected to exhibit a CAGR of 6.2% over the forecast period 2023 to 2030.
Regional analysis: Asia Pacific dominates the global rare earth metals market currently. China accounts for over 95% of global rare earth metals production currently. Countries like India and Australia are also expected to emerge as key producers in coming years to reduce dependence on China.
Key players: Key players operating in the rare earth metals market are Alkane Resources Ltd, Canadian Rare Earth Corp., China Northern Rare Earth Group High-Tech Co, China Rare Earth Holdings Limited., Iluka Resources Limited, Lynas Rare Earths Ltd., Peak Resources Limited, and Rainbow Rare Earths Limited.