Early stage plans for RE magnet plants in US, Europe

Momentum is building to diversify and expand supply chains for high-performance sintered neodymium iron boron (NdFeB) magnets needed for electric vehicle (EV) motors, with two potential magnet projects announced in the US and one in Europe.

In the US, mining firm MP Materials, which owns and operates the Mountain Pass light rare earth mine in California, yesterday announced plans to build a metal, alloy and magnet plant in Fort Worth, Texas, and the conclusion of a binding long-term supply agreement with large US automaker GM to supply US-sourced and manufactured rare earth materials, alloy and finished magnets. MP provided no details on the cost of the project, which has a provisional start date of 2023 and a proposed initial capacity of 1,000 t/yr of NdFeB magnets.

GM has also concluded a non-binding preliminary agreement with German magnetic material and sintered rare earth magnet producer Vacuumschmelze, which yesterday announced plans to build a magnet plant in the US with a start date of 2024. The proposed location of the plant was not disclosed.

"We are building a resilient and sustainable EV manufacturing value chain in North America from raw materials to components to drive GM's growth and support a mass market for EVs," GM vice-president, global purchasing and supply chain Shilpan Amin said."This will help ensure that we meet our goal to lead the EV industry in North America in more than just sales," he added.

In Europe, Canadian specialty materials and bonded rare earth magnet producer Neo Performance Materials plans to expand its operations at its Silmet light rare earth separation facility in Estonia, and build an alloy, metal and magnet manufacturing plant to supply the European automotive industry. Preliminary design work has been completed for phase one capacity of 1,000 t/yr of sintered EV motor magnets, at an estimated cost of around $50mn. According to the company, this would help to meet large European original equipment manufacturers' demand for a diversified, resilient and fully environmental and social governance-compliant rare earth magnet supply chain by 2025.

Questions of scale

The initial magnet capacities being proposed are small. The production of 1,000 t/yr of sintered NdFeB magnets would only require around 300 t/yr of metal and 400 t/yr of oxide. For comparison, Australian integrated oxide producer Lynas Rare Earths, which supplies the Japanese magnet industry, produced 5,461t of neodymium-praseodymium oxide — the main input for NdFeB magnets — in the financial year ending 30 June.

But the plans do raise questions about the supply source for the heavy rare earths that are added in small quantities to improve the performance of most NdFeB magnets for EV motors. There is currently no known commercial-scale heavy rare earth oxide production outside China.

The biggest barrier to all rare earth magnet projects outside China is economic. A number of potential solutions are being considered in the US and Europe, including tax credits. Some level of government assistance and a price premium for supplying rare earth materials and magnets that comply with specific sourcing and environmental and social governance standards may be the only way to break the deadlock that has stymied previous attempts, according to industry observers.

By Caroline Messecar