Rare Earths are not Rare

Rare Earth Elements have been in news for over a decade now primarily due to their application in electronics and Electric Vehicles. In high school we were just shown a band at the bottom of the Periodic Table, which contained some mysterious metals, which the chemistry teacher never bothered to explain, and we never asked. Afterall, who wanted an additional chapter in the syllabus.

Well, while we weren’t watching this group of 17 chemical elements in the periodic table, comprising the 15 lanthanides, plus scandium and yttrium, came to the centre-stage in our technology-driven lives. Some of them were used earlier too but the quantities were so small that their supply was never a constraint.

Today we use them in almost all everyday technology applications, gadgets and in many areas, where they are not openly visible. Neodymium is the most widely known; it is used in permanent-magnets in motors of Electric Vehicles, generators of wind turbines, in medical and industrial lasers and even as a glass additive to improve UV protection.

But there are many others, such as Terbium, Europium, and Yttrium that are used in phosphers in our display screens. Then there are many others that are used in high-temperature superconductors (Yttrium, again), high-strength alloys for aircraft and military applications, and something as mundane as welding-goggles (Praseodymium). They are used in precision guided missiles, smartphones, high-performance audio-systems, as neutron absorbers in nuclear-reactors, petroleum refining, fuel-cells, MRI contrast enhancement, optical-fibre, and even anti-counterfeiting features of currency notes. Simply speaking our modern lifestyle is not possible without the Rare Earths. The clean and green energy industry will collapse in absence of these elements.

Are They Really Rare?

Even though their collective name suggests so Rare Earth elements (REEs) are not geologically rare, but several factors make their extraction and processing complex and challenging:

• Rare earths are typically found in low concentrations within ores and are rarely found in economically concentrated deposits. Many rare earths occur together in the same ore but have different chemical properties, necessitating precise and lengthy separation methods.

• They are often mixed with other minerals, making separation a multi-step and energy-intensive process.

 Extraction of REEs is an Environmental Challenge

• Extracting and refining rare earths require chemical-intensive procedures, such as acid leaching and solvent extraction, to separate the desired elements from impurities.

• The extraction and processing of rare earths produce toxic waste, including radioactive byproducts, which require costly and stringent environmental management.
• In many countries, strict environmental regulations limit mining and processing activities, making the process less economically viable.

High Upfront Costs

• Setting up rare earth mining and refining operations requires significant capital investment.
• Infrastructure, expertise, and advanced technologies are essential, which can be prohibitive for new entrants.
• China, the largest producer of REEs, has historically used low and predatory prices to drive competitors out of the market and has forced mines in the U.S., Australia, and elsewhere to shut down due to unprofitability.

• Historically, the rare earth market has been volatile, with fluctuating prices discouraging long-term investment outside established production hubs.

Why Does China Dominate Rare Earth Production?

China's dominance in rare earth production is due to a combination of resource availability, government policy, and historical developments:

• China holds some of the world’s largest rare earth reserves, particularly in regions like Inner Mongolia.
• While other countries also have reserves, China's resources are geographically accessible and have been developed extensively.

• China recognized the strategic importance of rare earths early on and began investing heavily in mining, refining, and processing capabilities in the 1980s and 1990s. The Chinese government actively supports the rare earth industry, recognizing its importance for strategic sectors such as defence, electronics, and clean energy.

• The country built a robust supply chain, including research and development, giving it a technological edge over competitors.

• For many years, China had relatively lax environmental regulations, allowing it to process rare earths at a lower cost compared to countries with stricter environmental controls.

• China controls not just mining but also the midstream and downstream parts of the supply chain, such as refining and manufacturing rare earth-based products. This vertical integration makes it difficult for other countries to compete.

Challenges for Other Countries

• Lack of Infrastructure: Many countries lack the established infrastructure for mining and refining rare earths.

• Economic Viability: The high costs of labor, environmental compliance, and technology deter new projects.

• Dependence on China: Even when rare earths are mined outside China, refining often occurs there because of its established capabilities.

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Current Developments

• Diversification Efforts: Countries like the U.S., Australia, Canada, and now India are investing in rare earth mining and processing to reduce dependence on China.
• Recycling: Efforts to recycle rare earths from electronic waste are gaining momentum to mitigate supply risks.
• Strategic Alliances: Governments are forming partnerships to secure rare earth supplies.
• However, building the mining-to-product supply-chain will take time and significant investment.

Developments in India

The Government of India, realised the importance of Rare Earths early and established the IREL (India) Limited, formerly Indian Rare Earths Limited, is a government-owned corporation under the Department of Atomic Energy as early as in 1950. The company operates several facilities across the country, including units in Kerala, Tamil Nadu, Odisha, and a Rare Earths Division in Aluva. IREL has been instrumental in extracting and processing rare earth minerals like monazite to produce rare earth compounds.

There is a plan to boost the production of REEs by 400% over a decade. Efforts are underway to find new deposits, providing funds for research, and to incentivise production of downstream products. This aligns with India’s march towards green and renewable energy targets. Whereas Indian my not become self-reliant in the entire supply-chain of Rare Earths and their utilisation, we may reduce our dependency on imports significantly in years to come. The private sector has to pitch-in with equal enthusiasm to make it happen, something not yet seen in a large measure on the ground.

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