Demand Forecasting in World Rare Earth Metals Market

The rare earth metals (REM) market is relatively young, because its rapid development began only in the middle of the 20th century. Since then, global demand has been constantly growing with the development of human society, scientific and technological progress. This leads to an increase in production volumes at existing fields, new projects for the development of rare earth mineral resources are emerging all over the world, strategic reserves of raw materials are being created in countries with a developed high-tech industry in the conditions of China’s monopoly on the market. Therefore, it is important to understand the balance and dynamics of supply and demand in the REM market in the long term. Will manufacturers be able to increase capacity to meet the rapidly growing demand? What volume of REM will be in demand in the future, what is the structure of this demand?
In this paper, demand forecasting in the global REM market up to 2050 is carried out on the basis of different scenarios. Estimates of the future level of demand were based on historical data in the context of consumption sectors. The forecasts results of three scenarios were compared: the exponential demand dynamics based on complete historical data, the continuation of the linear trend of the last decade using a regression model, and, finally, the inclusion in the regression model of forecast estimates of the growing demand for REM from the “green energy”, which are based on the report “The Role of Critical
Minerals in Clean Energy Transitions” of the International Energy Agency. Based on the results, an interval of forecast values of global demand for REM has been obtained, which can be satisfied by manufacturing companies from the supply side for the next 15–20 years (including domestic ones). However, there may be a shortage of some rare earth elements that are so in demand for the transition to “green energy”.

1. Volker Zepf. Rare Earth Elements. A New Approach to the Nexus of Supply, Demand and Use: Exemplified along the Use of Neodymium in Permanent Magnets. Berlin, Heidelberg, Springer, 2013, 162 p. DOI 10.1007/978-3-642-35458-8

2. Быховский Л. З., Тигунов Л. П., Темнов А. В. Об определении понятий «редкие элементы» («редкие металлы»): исторический и терминологический аспекты // Минеральные ресурсы России. Экономика и управление. 2015. № 3. С. 32–38.

3. Binnemans K., Jones P. T. Rare Earths and the Balance Problem. Journal Sustainable Metallurgy, 2015, no. 1, pp. 29–38. DOI 10.1007/s40831-014-0005-1

4. Kooroshy J., Tiess G., Tukker A., Walton A. (eds.). Strengthening the European rare earths supply chain: Challenges and policy options. A report by the European Rare Earths Competency Network (ERECON). 2015. Ref. Ares(2015) 2544417. URL: https://ec.europa.eu/growth/sectors/raw-materials/specific-interest/erecon_en (дата обращения 30.09.2015).

5. Wang J. et al. Long-term outlook for global rare earth production. Resources Policy, 2020, no. 65, p. 101569. DOI 10.1016/j.resourpol.2019.101569

6. Яценко В. А., Самсонов Н. Ю., Крюков Я. В. Опционный подход к экономической оценке проектов разработки редкоземельных месторождений // Мир экономики и управления. 2018. Т. 18, № 4. С. 69–84. DOI 10.25205/2542-0429-2018-18-4-69-84

7. Alonso E. et al. Evaluating Rare Earth Element Availability: A Case with Revolutionary Demand from Clean Technologies. 2012. DOI 10.1021/es203518d

8. Wang X. et al. Production forecast of China’s rare earths based on the Generalized Weng model and policy recommendations. Resources Policy, 2015, no. 43, pp. 11–18.

9. Ge J., Lei Y., Zhao L. China’s Rare Earths Supply Forecast in 2025: A Dynamic Computable General Equilibrium Analysis. Minerals, 2016, vol. 3 (6), p. 95.

10. Wang X. et al. China’s rare earths production forecasting and sustainable development policy Implications. Sustainability (Switzerland), 2017, no. 6 (9).

11. Wang J. et al. Long-term outlook for global rare earth production. Resources Policy, 2020, no. 65, p. 101569.

12. Kennedy J. C. Rare Earth Production, Regulatory USA / International Constraints and Chinese Dominance: The Economic Viability Is Bounded by Geochemistry and Value Chain Integration. In: Rare Earths Industry: Technological, Economic, and Environmental Implications, 2016, pp. 37–55.

13. Яценко В. А., Самсонов Н. Ю., Крюков Я. В. Особенности мирового рынка редкоземельных металлов // Минеральные ресурсы России. Экономика и управление. 2018. № 6. С. 68–72.

14. Крюков В. А., Яценко В. А., Крюков Я. В. Редкоземельная промышленность – реализовать имеющиеся возможности // Горная промышленность. 2020. № 5. С. 68–84. DOI 10.30686/1609-9192-2020-5-68-84

15. Zhou B., Li Z., Chen C. Global Potential of Rare Earth Resources and Rare Earth Demand from Clean Technologies. Minerals, 2017, no. 11 (7), p. 203.

16. Goodenough K. M., Wall F., Merriman D. The Rare Earth Elements: Demand, Global Resources, and Challenges for Resourcing Future Generations. Natural Resources Research, 2018, no. 2 (27), pp. 201–216.

17. Kingsnorth D. J. Meeting the challenges of rare earths supply in the next decade. In Industrial Minerals Company of Australia Pty Ltd. The Hague Centre for Strategic Studies, 2011. URL: http://www.reitausa.org/storage/IMCOA%202010.12%20Strategic%20-Studies%20The%20Hague%20Final.pdf.