Adamas Intelligence recently released a report which forecasts that the worldwide demand for neodymium magnets will rise at a compound annual growth rate (CAGR) of 7.5% in the period between 2023 and 2040. Neodymium magnets or NdFeB as they are also known, are widely used rare-earth magnets made of iron, neodymium and boron.
Adamas Intelligence is an independent research and advisory company based in Toronto, Ontario, focused on critical minerals and metals research. The company believes the demand for the metals will be bolstered by the growth of the wind power and electric vehicle sectors. The report states that this growth will then increase the demand for critical rare earth elements such as terbium, dysprosium and didymium, which the magnets contain. The prediction also considers events and trends observed in the last couple of years.
The research firm’s data shows that in 2022, the consumption of NdFeB magnets globally rose by 1.9% year over year, repressed by regional pandemic-related issues and global economic headwinds. Adamas’ prediction also shows the production of terbium, dysprosium and didymium increasing in the aforementioned period at a CAGR of 5.2%, as the supply side struggles to keep pace with rapidly increasing demand.
The firm forecasts that by 2030, there will be an annual undersupply of NdFeB power and alloy that adds up to 60,000 tons. This is expected to increase to 246,000 tons yearly by 2040. The report also highlights that the expectation that NdPr oxide, which is utilized in the production of NdFeB magnets, will be undersupplied by 90,000 tons by 2040. This, it argues, will be due to a lack of new secondary and primary supply sources. The research firm also predicts that the undersupply of didymium oxide globally will increase to 19,000 tons annually by 2030, before reaching 90,000 tons by 2040.
With no new primary and secondary sources of supply, it is expected that terbium and dysprosium oxides (or oxide equivalents) will follow a similar pattern. Adamas forecasts the annual undersupply of the two compounds to reach 450 tons and 1800 tons respectively.
Overall, the magnet rare earth oxide market is expected to grow fivefold by 2040, while prices are forecasted to grow at CAGRs of 3.3% to 5.2% and total consumption of magnet rare earth oxide predicted to grow at a CAGR of 5.2% vs. a higher 7% for demand during the same period. The report also underscores that the value of international consumption of magnet rare earth oxide will grow fivefold by 2040, to reach an estimated $56.7 billion by 2040.
This bullish outlook for rare earth metals suggests that companies such as Ucore Rare Metals Inc. (TSX.V: UCU) (OTCQX: UURAF) could see sustained growth over the coming years as increasing demand results in higher prices.
NOTE TO INVESTORS: The latest news and updates relating to Ucore Rare Metals Inc. (TSX.V: UCU) (OTCQX: UURAF) are available in the company’s newsroom at http://ibn.fm/UURAF
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