Over the last 10-15 years world consumption of REO has increased at 8-12% per annum, and in 2011 consumption is forecast to be in the order of 150,000 tonnes (1.5-2B US$). Global demand for REEs is already outweighing supply, resulting in sharp increases in their value. China currently contributes > 90% of global REE supply, and already consumes > 60%.
In recent years the Chinese have been steadily reducing export quotas, and increasing export taxes, in recognition that REOs represent a very strategic metal group. As with many raw materials, the REE landscape is at a point of radical change. China is turning its priority from supplying the world, to supplying the burgeoning demand from internal industries that are dependent on REE availability.
By 2015 global consumption of REEs is forecast to increase by 65% from current levels, driven by significant market growth for many applications that rely on REEs. As a result the world urgently needs new, long-term stable suppliers of REEs to meet the strong demand. Given that the major applications for REEs are products and devices that offer environmental benefits, the need to significantly increase REE supply is paramount to facilitating the emergence of new technologies that can help to preserve the world as we know it.
As the future supply and demand forecasts for REEs begin to emerge, it is clear that some REEs with high industry dependence will remain under supply pressure for many years to come. These are now referred to as ‘Critical’ rare earths (CRE’s) by the US Department of Energy and include neodymium, europium, terbium, dysprosium, and yttrium.