US Rare Earth Elements Market Size, Forecast, and Competitive Landscape: Explore Peak Resources LP's IPO Potential in the US

US Rare Earth Elements Market Outlook

The US rare earth elements market is a vital sector driven by the increasing demand for these critical materials in high-tech industries such as electronics, renewable energy, and defense, with a focus on reducing dependence on foreign suppliers and enhancing domestic production capabilities. The market is expected to grow at a CAGR of 6%-8% between 2025 and 2029. Exact values for this market can be accessed upon purchasing the report. Key companies in the rare earth elements market in the US include:

• Lynas Rare Earths
• MP Materials
• Neo Performance Materials
• USAC
• Others

Peak Resources LP in the US rare earth elements market

Peak Resources LP is set to launch its IPO on the NYSE in late 2024 under the ticker symbol PRB, creating a new opportunity for investors. Peak Resources LP is a private investment firm focused on the development and commercialization of natural resources, particularly in the mining and energy sectors. The company specializes in identifying, acquiring, and managing projects related to critical minerals, with an emphasis on rare earth elements (REE) and other strategic commodities. Peak Resources LP aims to support the transition to a low-carbon economy by providing the raw materials essential for renewable energy technologies, such as electric vehicles, wind turbines, and solar panels.

How is the US rare earth elements market segmented?

Application

• Magnets
• Catalysts
• Metallurgy
• Batteries
• Others

End-Use

• Electronics and Electrical
• Defense and Aerospace
• Automotive
• Others

The electronics and electrical segment is the largest end-user in the market, driven by the high demand for rare earth elements in the production of magnets, displays, batteries, and other components used in devices like smartphones and laptops. In terms of product types, permanent magnets, particularly neodymium and dysprosium, dominate the market due to their critical use in electric vehicles, wind turbines, and consumer electronics, driving high demand for these materials.

Why investigate the US rare earth elements market with Technavio??

Recent developments in the US rare earth elements market reflect the growing demand for these critical materials, driven by their essential role in clean energy technologies, electric vehicles (EVs), defense systems, and consumer electronics. The US government has ramped up efforts to reduce dependence on China for rare earth supply, which has historically controlled most of the global market.

In 2023, the US EV market saw record sales, which further accelerated the demand for these materials. Rare earth elements are also critical to defense technologies such as missile guidance systems, radar, and drones. The US military’s increasing reliance on advanced technologies has spurred demand for a stable, domestic supply of rare earth elements.

Advances in extraction techniques, such as bioleaching (using bacteria to extract rare earth elements from ores), hydrometallurgical processes, and ionic clay deposits, are gaining attention. These technologies promise to reduce the environmental impact and cost of rare earth extraction. The US is increasingly funding research in this area, with companies exploring alternative and more efficient methods to process and extract rare earth elements from domestic deposits.

What market dynamics are influencing the US rare earth elements market?

Drivers: Growth in Clean Energy Technologies

• Electric Vehicles (EVs): Rare earth elements like neodymium and praseodymium are critical for manufacturing permanent magnets used in electric motors. As the US accelerates its shift to clean energy and electric vehicles, demand for these rare earth elements has surged. EV production requires significant quantities of REEs, and US automakers are ramping up their EV strategies to meet both domestic and global demand.
• Wind Energy: Rare earth magnets are also essential in the production of wind turbines, especially offshore wind farms, which are expected to play a growing role in the US energy transition. As wind energy expands, the need for rare earth elements like dysprosium and terbium (used in high-performance magnets) is expected to increase.
• Energy Storage: The growth in renewable energy storage technologies, such as lithium-ion batteries and other advanced energy storage systems, is also driving demand for certain rare earth elements, including lanthanum and cerium, which are used in battery technologies.

Trends: Technological Innovation and Advancements

• Electric Motors and Magnet Technologies: The advancement of electric motor technology (for everything from consumer electronics to electric vehicles and industrial machinery) is one of the key drivers of demand for rare earth elements, particularly the permanent magnets that are used in motors. Continued innovation in motor design and efficiency improvements are spurring increased demand for neodymium-iron-boron magnets, which require rare earth elements.
• Consumer Electronics: Rare earth elements are used in a range of high-tech consumer electronics like smartphones, tablets, LED lights, hard drives, headphones, and digital cameras. As these markets continue to expand with the growth of the tech industry, the need for rare earth elements increases.

Challenge: Reliance on Foreign Sources

Despite the increasing demand for rare earths driven by sectors like electronics, renewable energy, and defense, the US has limited domestic production capacity, leaving it vulnerable to supply chain disruptions, geopolitical tensions, and fluctuating prices. This dependence creates national security concerns and hinders the ability to meet growing demand, especially as the need for rare earths in electric vehicle manufacturing and renewable energy technologies accelerates. Efforts to develop sustainable and competitive domestic mining and processing capabilities face significant environmental, regulatory, and economic barriers, making this a persistent challenge for US market stability.

Opportunities: Government Initiatives and Policy Support

• Strategic Initiatives and Funding: The US government has recognized the importance of securing a stable supply of rare earth elements for both economic and national security reasons. Several initiatives have been introduced, such as funding for rare earth mining and refining capacity, aimed at reducing dependence on foreign suppliers. In 2022, for example, the US Department of Energy awarded funding to projects focused on rare earth elements processing, recycling, and extraction technologies.

Questions to consider when investing in the US rare earth elements market

What is the company’s access to rare earth deposits?

• Resource Quality and Size: Does the company have access to significant, high-quality rare earth deposits? The size and quality of the resource base will influence the company's long-term viability.
• Geographic Location: Where are the company’s mines and processing facilities located? Proximity to infrastructure (like transportation and energy sources) and markets is crucial for cost control and logistics efficiency.

How diversified is the company’s supply chain?

• Supply Chain Risk: Does the company rely heavily on one or a few sources for its rare earth supply? Diversification in sources of raw materials and refining capabilities reduces the risk of disruptions.
• Processing and Refining Capabilities: While mining operations are key, rare earth processing is another critical part of the supply chain. Does the company have its own refining and processing infrastructure, or is it dependent on external sources?

What is the company’s strategy for sustainability and circular economy initiatives?

• Recycling and Reuse: With growing concerns about sustainability, many rare earth companies are looking into recycling rare earth elements from end-of-life products. Does the company have plans to invest in rare earth recycling technologies or circular economy practices?
• Sustainability Initiatives: Is the company involved in any initiatives to reduce the environmental impact of its mining operations, such as reducing waste, improving water usage, or using cleaner energy sources?

For a detailed analysis of the US rare earth elements market, buy the full report

How can Technavio reports help investors make better business decisions?

Key Features of a Technavio Report: 

• Comprehensive Market Analysis: Provides a detailed overview of the US rare earth elements market, including market size, growth rate, segmentation, and regional analysis. 

• In-Depth

  Competitive Landscape:

  Offers insights into the competitive dynamics, market share and positioning, and product offerings of key players. 

• Future Market Trends: Identifies emerging trends and opportunities that can shape the future of the market. 

• Detailed Segmentation: Breaks down the market into various segments to help investors identify specific niches and target markets. 

• Expert Analysis: Provides expert insights and forecasts from industry analysts

FAQ

1. What are rare earth elements (REEs)?
Rare earth elements are a group of 17 chemical elements that include the 15 lanthanides, as well as scandium and yttrium. They are essential in the production of high-performance magnets, batteries, and other technologies, including electric vehicles (EVs), wind turbines, consumer electronics, and military equipment.

2. Why are rare earth elements important?
Rare earth elements are critical for many advanced technologies, including clean energy (solar, wind, and EVs), electronics (smartphones, computers, and TVs), and defense (missiles, radar, and satellites). They are indispensable in the production of high-strength magnets, which are used in motors, turbines, and a wide array of high-tech applications.

3. Why is the US concerned about rare earth supply?
The US is concerned about its dependence on China, which controls more than 60% of the global supply of rare earth elements. This dependency is a national security risk, particularly because rare earth elements are essential for military technologies. Additionally, disruptions to supply due to geopolitical tensions or trade restrictions could impact industries like electronics and clean energy, which also rely on these materials.

4. What are the prospects for rare earth recycling in the US?
Recycling rare earth elements is gaining momentum as a solution to reduce environmental impacts and dependence on mined materials. The US is investing in rare earth recycling technologies, which involve recovering rare earth elements from electronic waste, magnets, and other end-of-life products. While recycling is still in its early stages compared to primary mining, it offers significant potential to create a more sustainable, closed-loop supply chain for rare earth elements.

5. How can investors benefit from the US rare earth elements market?
Investors can benefit from the US rare earth elements market by investing in companies that are involved in mining, refining, and recycling rare earth elements, as well as those that produce technologies reliant on rare earth elements (such as electric vehicle manufacturers). Given the geopolitical and strategic importance of rare earth elements, there is growing interest in securing a domestic supply, which presents opportunities for companies involved in domestic production, supply chain innovation, and technology development.

US Rare Earth Elements Market Report Table of Contents

1. Executive Summary

2. Scope of the Report

3. Market Landscape

3.1 Market Ecosystem

3.2 Market Characteristics

3.3 Market Segmentation Analysis

4. Market Sizing

4.1 Market Definition

4.2 Market Sizing 2023

4.3 Market Size and Forecast 2024-2028

4.4 Historic Market Size (2018-2022)

5. Impact of Technology

6. Five Forces Analysis

6.1 Bargaining power of buyers

6.2 Bargaining power of suppliers

6.3 Threat of new entrants

6.4 Threat of substitutes

7. Rivalry among competitors

8. Market Segmentation

9. Customer Landscape

10. Drivers and Challenges

11. Market Trends

12. Competitive Landscape

13. Appendix

13.1 Research Methodology

13.2 List of Abbreviations