Recently, the rare earth industry circle has been in an uproar over a piece of news. On May 19th, the Australian Broadcasting Corporation published an article stating that Lynas Rare Earth Company in Australia successfully produced dysprosium oxide, a heavy rare earth element, at its newly built factory in Malaysia, transforming it into the first company outside China to commercialize the separation of heavy rare earth elements. Western media became instantly excited, with many voices claiming that China's monopoly in the field of heavy rare earths had been broken. But is this really the case? Today, let us discuss this topic.
First, let’s have a quick科普. Rare earths are not treasures in the soil but are collectively referred to as 17 metal chemical elements, divided into light rare earths and heavy rare earths. Don’t underestimate these elements; they are essential "bricks" in modern industries. For example, elements like dysprosium and terbium in heavy rare earths are key materials for manufacturing high-performance permanent magnets, which are indispensable components in electric vehicles, high-performance magnetic materials, renewable energy equipment, and even military fields such as the laser guidance systems of F-35 fighter jets and hypersonic missile propulsion systems. They are truly the "vitamins" of modern industry, with consistently high global demand.
Lynas' breakthrough indeed dropped a "small bomb" in the global rare earth industry. From a geopolitical perspective, the US Department of Defense investing $258 million in Lynas' Texas plant was not charity; it reflects the long-standing Western desire to "de-Chinese" supply chains and reduce reliance on China's rare earth supplies. From an industrial development standpoint, it brought new players to the global rare earth market, providing alternative choices for enterprises seeking diversified supply.
However, thinking that Lynas' breakthrough could undermine China's dominant position in the rare earth sector is wishful thinking. In terms of production capacity and market share, China's advantage is "crushing." China's projected annual production of heavy rare earths in 2025 is expected to reach 15,000 to 20,000 tons, with imports and recycling adding up to more than 30,000 tons annually; whereas Lynas plans to separate 1,500 tons of mixed heavy rare earths per year, accounting for only about 5% of China's total separation volume. This level of capacity cannot even meet the needs of the United States, a major consumer of heavy rare earths, let alone supply the world. Moreover, China's rare earth products are highly competitive in price, with separation costs ranging from $4 to $7 per kilogram, while Lynas charges between $10 and $15. Once market competition kicks in, Lynas' cost disadvantage will become evident.
In terms of technology and industrial chain integrity, China stands unrivaled. Years of development and accumulation have enabled China to master leading global technologies for rare earth separation and purification, with numerous patents and highly mature processes, allowing for precise and efficient production. Simultaneously, China has established a complete industrial chain from rare earth mining, smelting and separation, deep processing of rare earth materials, to the manufacturing of end products, with tight collaboration between upstream and downstream sectors. In contrast, although Lynas has achieved a breakthrough in the commercial separation of heavy rare earths, there remains a significant gap compared to China in terms of technical stability, product diversity, and the ability to integrate industrial chains. For instance, during the separation process, China's processes can better control impurities and maintain product quality stability, whereas Lynas still has much work to do to reach the same level.
Additionally, China also has substantial confidence in its rare earth resource reserves. Although rare earth reserves are distributed globally, China's reserves remain considerable. Furthermore, through optimized management and technological advancements, China can further reduce costs and enhance efficiency in extraction and separation, solidifying its advantages.
China's rare earth industry must not take Lynas' breakthrough lightly. Continuous innovation is crucial. On one hand, it must continue to tackle core technologies such as rare earth separation and purification to maintain its technological lead; on the other hand, it should increase investment in the research and development of rare earth new materials and the expansion of terminal applications to enhance the added value of rare earth products. At the same time, further improving the industrial chain and strengthening cooperation and coordination among upstream and downstream enterprises will enhance the overall competitiveness of the industry. Additionally, against the backdrop of a complex and ever-changing global trade environment, Chinese rare earth companies need to actively expand international markets and strengthen cooperation with other countries to stabilize their overseas market shares.
Lynas becoming the first company outside China to commercialize the separation of heavy rare earths is like throwing a pebble into the rare earth industry lake, creating ripples, but far from causing a tidal wave. The deep foundation and strong strength accumulated by China's rare earth industry over the years remain the solid cornerstone supporting its dominant position in the global rare earth market. In the future, as long as China's rare earth industry continues to innovate and improves itself, it will undoubtedly maintain its invincible position in global competition and continue to hold the discourse power in the rare earth industry.
Original article: https://www.toutiao.com/article/7506320241346019880/
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