According to a recent study by Hexa Research, high demand for rare earth elements like cerium and lanthanum in applications including automobiles, metallurgy, phosphors, and glass will drive global market growth. Rare earth elements are a group of 17 elements bearing similar properties. Key elements in the group include lanthanum, praseodymium, cerium and neodymium. Rising demand for permanent magnets in the electronic, wind turbine and automotive sectors will translate into high demand for neodymium. Phosphor is essential to manufacture consumer electronic components like LCD screens and CRT displays. Elements such as terbium, europium and yttrium are used in the phosphors industry. Hexa Research predicts that the global rare earth elements market will reach $10.96 billion in 2020.

Cerium was the most-consumed rare earth element in 2013, according to the study, accounting for more than 40% of the total market. The main applications of cerium included petroleum refining and metallurgy. Application categories of rare earth elements are catalysts, magnets, metallurgy, glass and polishing. Permanent magnets grabbed highest market share in 2013, followed by catalysts and metallurgy. Permanent magnets will experience the fastest growth in the coming years.

Growing end-use industries in developing Asia-Pacific regions will accelerate demand for the rare earth elements market in the near future. Asia-Pacific fetched revenues close to $3.8 billion in 2013. China was both the largest consumer and producer of rare earth elements in 2013. This will contribute to Asia-Pacific experiencing the fastest growth at a compound annual growth rate (CAGR) of 11.5% from 2014 to 2020. Growth in the automotive sector will also contribute to market growth. Molycorp (U.S.) and Inner Mongolia Baotou Steel Rare Earth HI-Tech Co. (China) were the dominant players of the rare earth elements industry in 2013. Russia has reserves accounting for about 19%, the U.S. with 13%, Australia with 5.4% and India over 3%.

Factors like limited reserves, strict regulatory guidelines, complicated extraction process and heavy capital deployment are likely to adversely affect market growth. However, the creation of elements from recycled waste is an area of opportunity for future.

 Additional details are available at www.hexaresearch.com.