Weekly Review: Multiple Countries Invest Millions in Their Magnet Supply Chains – What About Us?

However, while China threatens that Europe is jeopardizing its energy transition and digitalization, the Federation of German Industries (BDI) believes the law does not go far enough. Only if there are increased investments in raw material projects alongside shortened approval times for mines can the CRMA truly contribute to European independence in critical raw materials such as dysprosium oxide.

Critical commodities required by the EU should come 10% from domestic mining, with 40% to be processed within the EU. Strategic commodities such as neodymium oxide should not be more than 65 percent dependent on imports from a single third country. The potential issue China may have with the CRMA framework becomes clearer when looking at the United States.

Significant funding is currently being allocated there for an independent supply chain from mine to magnet, sponsored by the Department of Defense. The continued dependence of the United States on foreign sources for rare earth products poses a national security risk. Since 2020, more than $439 million has been allocated for building domestic supply chains for rare earth elements. This includes the separation and refining of rare earth elements mined in the United States, as well as magnet development.

The world is increasingly becoming the scene of military conflicts once again. Victory will likely go to those who, to paraphrase Napoleon, have the battalions. And today that means: the right commodities. Magnets manufactured from rare earth elements are used in F-35, Virginia-class, and Columbia-class submarines. They are also used in systems such as Tomahawk missiles, various radar systems, unmanned Predator aircraft, and smart bombs. An F-35 jet, for example, requires more than 400 kg of rare earth elements. Each Arleigh Burke DDG-51 destroyer contains approximately 2,800 kg, and a Virginia-class submarine incorporates 4,100 kg of rare earths. Independent access by Western nations to rare earths certainly also represents a threat to China through their resulting growing military strength.

Outside the United States as well, the magnet supply chain has come into focus. Rare earths such as terbium oxide are also indispensable for the automotive industry. This industry is increasingly dependent on metals that meet the IRMA standard and requires transparent supply chains for this purpose.
It is therefore fortuitous that the Canadian government is supporting the construction of a domestic rare earth processing facility in Saskatoon with approximately $4.5 million. Rare earth oxides will be extracted from monazite ore there using a new process. According to the government, the new commodities are sufficient for 65,000 new electric vehicles per year.

The Australian mining company Arafura now intends to combine rare earth mining and further processing in its own country. Previously, the latter was only possible at the refinery in Malaysia. The Australian government is supporting Arafura’s initiative with approximately $533 million. The project primarily produces light rare earths such as neodymium oxide and praseodymium oxide. However, the automotive industry primarily requires the heavy magnetic rare earths dysprosium oxide and terbium oxide.

This is where we come into the picture. The Noble Group is currently actively seeking partners to implement the further processing of heavy rare earths into Western supply chains. Our trump card is the mine we “discovered” in South Africa, whose ore contains the heavy rare earths required for magnet production. Discussions with suppliers, traders, and key industry representatives are ongoing. In a certain sense, we are on the path to establishing a heavy rare earth consortium.