By Michael Montgomery—Exclusive to Rare Earth Investing News
The world of rare earth elements can be confusing to the average investor. REEs are made up of 17 different elements on the periodic table, with markets as difficult to understand as the pronunciation of their individual names. Neodymium, Dysprosium, Ytterbium, and Praseodymium, are just a few metals in this dynamic market. With the recent reduction of export quotas from China, the prices for not only the metals, but the products that they are used in will undoubtedly climb until new sources are found, and mined.
The demarcation between heavy and light rare earth elements (REEs) is an important distinction when looking at ore grades from various mining projects. It is, however, a misnomer that one type is more valuable than the other. For one, many of these elements accompany each other in deposits, and it is important to consider supply and demand fundamentals to determine the value of a project. Some of the ‘heavies’ are more rare in quantity in earths crust, but may not have common uses to drive market price.
“When REEs are being discussed, people should define what they mean by the light and heavy rare earths. For me, the lights go midway through gadolinium. I would classify the heavies as terbium through lutetium… For me this demarcation is more rigorous from a scientific point of view. Otherwise the distinction between the LREEs and HREEs is arbitrary,” stated Tony Moriano, in an interview with The Gold Report.
Heavy Rare Earth: HREE’s
Heavy rare earth elements are the elements on the periodic table that have a tetragonal structure; these include Terbium, Dysprosium, Holmium, Erbium, Thulium, Ytterbium, and Lutetium.
Light Rare Earth Elements: LREE’s
Light rare earth elements have a monoclinic molecular structure and include the elements Lanthanum, Cerium, Praseodymium, Neodymium, Promethium, Samarium, Europium, and Gadolinium.
The uses for these elements range from hybrid vehicle technology and wind turbines, to guidance systems for some of the most advanced military technology. The better an investor can understand the individual metals, and their uses, they better their ability to capitalize on each unique opportunity as it arises. This is a guide to understanding the various metals inside the rare earth market.
Neodymium’s main application is for high strength magnets. Neodymium magnets are the strongest permanent magnets known. These magnets are used in a wide variety of products such as microphones and speaker systems where low mass, small volume and strong magnetic fields are needed. For larger industrial use, neodymium magnets are used in high power electric motors such as those found in hybrid and electrical vehicles. Each motor requires approximately 1 kilogram of neodymium. Also, the magnets are used in electrical generation in numerous new renewable energy technologies such as wind turbines, a market that is set for large growth through at least the next decade. In this application, about one ton of neodymium is needed for every megawatt of generating capacity from a wind turbine. This material is also used to color glass,and mainly used for infrared emitting lasers.
Dysprosium is often used along with vanadium and other elements in the manufacturing of laser materials. The elements high thermal neutron absorption cross-secti0n it is ideal for making neutron-absorbing control rods in nuclear reactors. It’s high susceptibility to magnetization makes it ideal for use in various data storage applications including hard disks.
The dysprosium magnets are used in hybrid cars. “As much as 6% of this alloy may be dysprosium metal (substituted for neodymium). This amounts to over 100 gm of dysprosium oxide for each motor, which means that hybrid electric vehicles alone will require over 200 mT of dysprosium oxide by 2010, based upon Toyota’s projected 2 million units per year…the requirement for dysprosium from a few very demanding applications such as this will exhaust most of the available supply,” according to a study by Dr. Peter Campbell.
While China currently controls over 95 percent of the complete rare earth market, almost 100 percent of the dysprosium and terbium market comes from China currently. However, there are a few projects in the very early, exploratory phases in North America, and Australia.
Lanthanum is used mainly in nickel-metal hydride batteries, and other battery systems like lithium-ion batteries that are used in almost every handheld electronic device. “Every Toyota Prius [and similar hybrid vehicle] on the road uses one kilogram of neodymium and nearly 30 pounds of lanthanum in its lithium battery,” reported Aaron Levit, for Investopedia.
The metal is also used in a wide variety of industrial lighting applications, which consumes a large proportion of the material. Various oxides and compounds of lanthanum are used in a wide variety of products such as semiconductors and the production of carbon nano-tubes, which are some of the strongest and lightest compounds known to science; use of such materials, however, is still far off.
Terbium is a critical ingredient in Compact Florescent Light (CFL) bulbs, which are taking over the standard light for almost all consumer applications for their low energy consumption. The use of terbium in CFL bulbs is by far the largest use of the metal worldwide. The metal is also used in naval SONAR systems.
Cerium is the most abundant of rare earths, it is found in many minerals including monazite, allanite, bastnasite, and zircon. Used mainly in automotive catalytic converters, cerium will be increasingly important as China and India move to a more urban population base. The rise in automobile ownership in these countries will increase the use of cerium and palladium as it is a low cost replacement for platinum used in catalytic converters.
Great Western Mineral’s [CVE:GWG] Steenkampskraal rare earth mine in South Africa has a large concentration of cerium, and may supply the automotive market there. “The single most abundant of the 15 or 16 rare earth minerals found at Steenkampskraal was cerium, which is used in catalytic converters,” reported Anton Ferreira, for Times Live of South Africa.
Praseodymium has a wide array of uses from an alloying agent with magnesium for high strength metals used in aircraft engines, and as a glass doping agent for industrial lighting. It is also valuable because it shares a lot of the same properties as neodymium used in powerful magnets.
Praseodymium alloyed with nickel (PrNi5) produces a strong enough magneto caloric effect that with it scientists have been able to approach within one thousandth of a degree of absolute zero, an essential state in the creation of new super-conductors that may be necessary for new battery and electrical transmission technology.
Glass doped with praseodymium has been used by scientists to create “slow light,” where the speed of light is slowed down to a mere 38 miles per hour by the Rowland Institute for Science, and 21,600 miles per hour in a semiconductor at UC Berkeley. This fantastic breakthrough is being studied by IBM as a way to transmit information in computers in a more highly efficient fashion. However, this is the stuff of science fiction and practical applications are still far off.
Samarium has a variety of uses. Its unique magnetic properties allow it to resist de-magnetization when combined with cobalt. Magnets like these are used in headphones, and guitar pickups. In combination with other rare earths, it is used in industrial lighting, as an optical glass doping agent it absorbs infrared light.
Samarium is also used as a neutron absorber in nuclear reactors. The growing use of nuclear energy may be a driving factor in the growth of the samarium market.
Erbium when added to vanadium as an alloying agent lowers the hardness of the silvery gray metal and improves workability. Vanadium and vanadium steel is used in a wide array of products from tools to jet engines. Erbium is also used as a neutron absorber in nuclear reactors. Just as with samarium, the growth of nuclear energy will grow the demand for erbium.
These are just 8 of the most common rare earth elements. Look for more updates in the future on Rare Earth Investing News.