Via Metal Miner

Rare earth elements and semiconductors have taken on that critical national development role once occupied by oil and petroleum products. Despite the ongoing U.S.-China competition, the latter country controls a full 90% of the global rare earths supply, transforming these elements into potential political weapons.

With regard to semiconductors, China’s Civilian-Military Integration Strategy aims to develop more advanced technology, circumvent U.S. sanctions, and use rare earths to disrupt the manufacturing supply chain. This goes against the interests of many countries, including the U.S. and the European Union.

Because of China’s tight-fistedness, countries must scout for rare earths within their borders or establish other sources of supply. Amid all the rush to find divergent supply sources, the Belgian chemicals group Solvay has now provided assurances that it will soon be able to supply those rare metals used in permanent magnets and electric vehicles to Europe – at least, in part.

Europe’s Solvay Hopes to Provide Relief

A report by Reuters said Solvay plans to start the supply from its refurbished plant in France. The group expects regular production at its La Rochelle plant to begin in early 2025 and aims to supply 30% of Europe’s permanent magnet needs by 2030. Incidentally, this facility is the only one in Europe capable of processing both light and heavy rare earth materials at an industrial scale. (If you want to make informed rare earth sourcing decisions, opt into MetalMiner’s free Monthly Metals Index report to understand economic metal price drivers through metal price charts and expert analysis.)

Solvay believes the launch is well-timed, considering the EU’s initiatives to reduce imports from China and promote domestic production. Indeed, the company is currently in talks with Europe’s leading car manufacturers and turbine makers to secure orders.

Incidentally, Solvay reported a stronger-than-expected core profit for its second quarter, as higher volumes offset pressure from negative net pricing. Earnings before interest, taxes, depreciation, and amortization came in at €272 million (around $294 million), compared with the €261 million expected by analysts.

EU Sets Targets for Mineral Production

Meanwhile, a new EU law has set ambitious targets for material independence. The multi-member organization hopes to mine 10%, recycle 25%, and process 40% of its annual critical minerals needs domestically by decade’s end. Additionally, the law stipulates that no more than 65% of rare earth supplies should come from any single country.