• Connect with us
    • Information
      • About Us
      • Contact Us
      • Careers
      • Partnerships
      • Advertise With Us
      • Authors
      • Browse Topics
      • Events
      • Disclaimer
      • Privacy Policy
    • Australia
      North America
      World
    Login
    Investing News NetworkYour trusted source for investing success
    • North America
      Australia
      World
    • My INN
    Videos
    Companies
    Press Releases
    Private Placements
    SUBSCRIBE
    • Reports & Guides
      • Market Outlook Reports
      • Investing Guides
    • Button
    Resource
    • Precious Metals
    • Battery Metals
    • Base Metals
    • Energy
    • Critical Metals
    Tech
    Life Science
    Critical Metals Market
    Critical Metals News
    Critical Metals Stocks
    • Critical Metals Market
    • Critical Metals News
    • Critical Metals Stocks

    Adamas Intelligence: REE Market to be “Massively” Undersupplied by 2030

    Priscila Barrera
    Aug. 18, 2020 04:50PM PST
    Critical Metals
    ASX:LYC

    Adamas Intelligence Managing Director Ryan Castilloux talked to INN about what’s ahead for the rare earths market in the next decade.

    The first six months of the year were dominated by the impact of the coronavirus pandemic, which saw markets plummet globally as uncertainty increased in every forecast.

    Through the first half of the year, the outlook for rare earths demand was looking exceptionally bleak, but it has started to bounce back, particularly in Europe and China. That said, demand is currently on course for a 10 percent drop globally this year, according to Adamas Intelligence.

    “We expect automotive micromotors and sensors, passenger electric vehicle (EV) traction motors, consumer appliances and cordless power tools to be among the worst performing end-use categories in 2020 with demand falling by 15 to 20 percent,” said Managing Director Ryan Castilloux.

    On the other side of the spectrum, commercial EV traction motors, wind power generators and consumer electronics are expected to outperform, with demand, at least in the case of consumer electronics, expected to grow year-over-year.

    “Neodymium, praseodymium and didymium prices have been negatively impacted by the pandemic-induced lull in demand we’ve experienced in 2020 thus far,” Castilloux said.

    While Australia’s Lynas (ASX:LYC,OTC Pink:LYSCF) is expected to reduce production for the calendar year, Adamas Intelligence does not expect US-based MP Materials and China’s major producers to follow suit; that will result in overproduction for the year, which will continue to weigh on light magnet rare earth element (REE) prices.

    “Prices of the heavy magnet rare earths dysprosium and terbium have fared better, and despite a drop in demand this year, continue to trend upward as a result of stagnating global supply growth,” said the managing director of Adamas Intelligence.

    As the second half of the year continues to unfold, Castilloux is expecting to continue to see demand for NdFeB permanent magnets, and the rare earths they contain, recover through 2020 and into 2021.

    “We’re already beginning to see the tangible impact of Europe’s ‘recovery incentives’ on domestic EV sales and we’re hopeful that trend will continue,” he said.

    But for the remainder of 2020, Adamas Intelligence expects neodymium, praseodymium and dysprosium to be oversupplied globally.

    “With relatively little production growth expected in the near term, we forecast the global industry will deplete historically accumulated inventories of neodymium, praseodymium and dysprosium by 2022, and thereafter will be chronically undersupplied through the end of the decade,” he added.

    In fact, Adamas Intelligence, which recently released its REE Magnet Market Outlook to 2030 report, forecasts that global shortages of NdFeB alloy and powder will amount to 48,000 tonnes annually by 2030 — roughly the amount needed for some 25 to 30 million EV traction motors.

    Given that scenario, supply outside of China will need to be developed to meet the growing market.

    “Unquestionably, we need the development of new miners and processors outside China in the coming years, without which the world has little to no chance of satisfying rapidly growing rare earth demand.”

    By 2030, Adamas Intelligence expects to see approximately 55,000 tonnes per year of new total rare earth oxide production capacity developed outside China, and a further 60,000 to 80,000 tonnes per year capacity within China.

    “(Even with that new capacity) the market is still expected to be massively undersupplied,” he said.

    For the analyst, the greatest challenge for the market at present is access to capital and persistently low rare earths price levels.

    “Given the large upfront capital costs associated with development of many rare earth projects, we need prices to reach a higher level to incentivize investments in new producers,” he explained. “Fortunately, we see the market’s supply/demand fundamentals evolving in such a way that we believe higher prices are simply inevitable.”

    Even though some diversification is expected, Adamas Intelligence forecasts that China will continue to dominate every step of the mine-to-magnet supply chain through 2030.

    By that year, the firm is expecting China to be responsible for 62 percent of global mine supply of magnet rare earth oxides, 69 percent of global separated mine supply, 90 percent of global secondary supply, 90 percent of global magnet metal production, 90 percent of global NdFeB powder and alloy production and 90 percent of global sintered and bonded magnet production.

    “The greatest challenge for other nations looking to enter the rare earth market is the lack of downstream capacity to turn non-China rare earth mine outputs into the metals, alloys and magnets that end users need,” he said. “Until these downstream gaps are addressed, the vast majority of the non-Chinese world’s rare earth mine outputs will continue to flow to China.”

    Looking ahead, Castilloux said investors interested in the space should keep an eye on prices of magnet rare earths, which include neodymium, praseodymium, dysprosium and terbium.

    “We expect them to trend higher as demand continues to recover,” he said. “Also, keep an eye on NdFeB export numbers out of China, which serve as a good indicator for how demand is doing in key markets like the US and Europe.”

    Don’t forget to follow us @INN_Resource for real-time news updates.

    Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

    Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

    From Your Site Articles
    • Rare Earths Market Update: H1 2021 in Review ›
    otc:lyscfchinamp materialsadamas intelligenceasx:lyc
    The Conversation (0)

    Go Deeper

    AI Powered
    Periodic table symbols for 17 rare earth elements.

    Rare Earths Stocks: 9 Biggest Companies in 2025

    Rare earth metal.

    Rare Earths Reserves: Top 8 Countries

    Latest News

    Homerun Resources Inc. Signs Binding LOI for the Acquisition of Additional Mineral Rights in the Santa Maria Eterna Silica Sand District

    Locksley Resources Adds 249 Additional Claims to Landholding of More than 40 sq km of Highly Prospective Critical Minerals Ground in California's Mojave Region

    Allied Critical Metals Expands Santa Helena Breccia in Borralha with Long Tungsten Intercepts and Confirms High-Grade Trend

    LKY Doubles Landholding Abutting MP Materials in Mojave Hub

    Locksley Resources Limited Doubles Landholding Abutting MP Materials in Mojave Hub

    More News

    Outlook Reports

    Resource
    • Precious Metals
      • Gold
      • Silver
    • Battery Metals
      • Lithium
      • Cobalt
      • Graphite
    • Energy
      • Uranium
      • Oil and Gas
    • Base Metals
      • Copper
      • Nickel
      • Zinc
    • Critical Metals
      • Rare Earths
    • Industrial Metals
    • Agriculture
    Tech
      • Artificial Intelligence
      • Cybersecurity
      • Gaming
      • Cleantech
      • Emerging Tech
    Life Science
      • Biotech
      • Cannabis
      • Psychedelics
      • Pharmaceuticals

    Featured Critical Metals Stocks

    More featured stocks

    Browse Companies

    Resource
    • Precious Metals
    • Battery Metals
    • Energy
    • Base Metals
    • Critical Metals
    Tech
    Life Science
    MARKETS
    COMMODITIES
    CURRENCIES
    ×