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Argonne study finds rare earth supply disruptions can have long-range impacts

Rare earth materials are essential to a variety of economic sectors, including healthcare and clean energy. In a new study, scientists at Argonne National Laboratory highlighted which rare earth elements may be particularly vulnerable to disruptions such as mine shutdowns.

A range of devices and machines rely on rare earth elements that are mined and refined largely in China. Disruptions to this supply can have wide-ranging consequences, but the understanding of how those disruptions play out in global markets is limited. The researchers at Argonne are using a unique computer model to understand the effects.

Most of the 17 elements classified as rare earths are not actually rare, but they are difficult and expensive to extract from the ground and separate from each other. Rare earth elements are essential to many emerging technologies, including those that support a clean energy future. They include neodymium, praseodymium and dysprosium, which are components of energy-efficient permanent magnets used in wind turbines and electric vehicles, among other products; and gadolinium—the contrast agent taken before an MRI. The US government classifies these elements as critical materials in part based on their importance in manufacturing products that support national security.

China dominates the global rare earths market. The country produces an estimated 58% of mined rare earths, and it controls roughly 85% of the world’s refining capacity. The US accounted for more than 15% of rare earth mining output in 2020, but this material is exported for value-added processing and production.

A variety of disruptive events can affect the supply of rare earth materials, including natural disasters, labor disputes, construction delays and a pandemic.


Causes of supply disruptions. Broad categories of endogenous and exogenous supply disruption causes (yellow boxes) and example (blue boxes). Neither the supply disruption causes nor the categorization approach are inclusive of all those documented in the literature. Riddle et al.

In a study published in the journal Resources, Conservation and Recycling, Argonne researchers analyzed the potential effects of three supply disruption scenarios on 10 rare earth elements, along with a handful of associated compounds, to determine the market effects. To conduct the analysis, which was supported by the US Department of Defense’s Defense Logistics Agency, they used Argonne’s Global Critical Materials (GCMat) tool.

GCMat is an agent-based model, which is a computational framework for simulating interactions among different entities in a given system. This provides the ability to forecast rare earth market dynamics by modeling decisions that individual mining projects, producers and consumers might make. These ​“agents” continuously update their product prices, supply purchases, production volumes and capacity plans in response to market prices and supply availability.

The GCMat team uses Argonne’s high performance computing Bebop cluster at the Laboratory Computing Resource Center to calibrate the model and evaluate uncertainties over a range of diverse market scenarios.

Agent-based modeling looks at the parameters that trigger decisions, such as whether to open or close a mine, and how those decisions cascade through the market and supply chain.

—Allison Bennett Irion, study co-author and chair of Argonne’s Advanced Supply Chain Analytics initiative

The results of the study highlighted which rare earth elements may be particularly vulnerable to disruptions. The largest price increases in response to disruptions occurred for dysprosium oxide, which is used in permanent magnets, specialty alloys and other applications. Didymium oxide, which is a mixture of neodymium and praseodymium, was also found to be prone to price surges.

Results suggest that supply disruptions may foster earlier and more REE mine starts outside of China, although some of these mines may not be able to sustain operations post disruption. Further, price and associated market responses such as production, capacity, and demand tended to extend beyond the disruption period. Such market impacts in the magnet supply chain could affect the costs and availability of a number of emerging clean energy technology applications such as electric vehicles and wind turbines.

—Riddle et al.

In general, the analysis found that in the case of temporary scenarios—a one-year export stoppage and a two-year mine shutdown—price impacts tended to extend years beyond the disruption period. Effects on production, capacity and demand also could potentially last longer. The model suggested some mines that started up outside of China in response to a disruption would not likely be able to keep operating after primary supplies recovered.

The GCMat team is now working on changes to the model that will help align it with US goals to lower greenhouse gas emissions. They are enhancing representations of rare earth magnet markets for energy-efficient motors, including those used in wind turbines and electric vehicles. And new agent-based models of the lithium-ion battery supply chain will assess how shortages of global materials might affect the adoption of battery technologies important to electric vehicle markets.

GCMat, which has also been supported by the former Office of Energy Policy and Systems Analysis at DOE, is based on Argonne’s Repast Simphony, an open-source toolkit for implementing and using agent-based modeling.

The researchers also plan to use GCMat to evaluate the effectiveness of strategies such as recycling, conservation and diversification of supplies for reducing the severity of disruptions in rare earth markets.


  • Matthew E. Riddle, Eric Tatara, Charles Olson, Braeton J. Smith, Allison Bennett Irion, Braden Harker, David Pineault, Elisa Alonso, Diane J. Graziano (2021) “Agent-based modeling of supply disruptions in the global rare earths market,” Resources, Conservation and Recycling, Volume 164, doi: 10.1016/j.resconrec.2020.105193.



China's effective monopoly on rare-earth refining comes at a cost to China (massive pollution) and the rest of the world (supply disruptions and the weaponized threat thereof).

"Rare earths" are not rare.  They are a substantial fraction of common things like coal ash and the byproducts of the refining of the clay used to coat glossy paper.  It's long past time to slap tariffs on all things Chinese to move those processes back to our own countries.


These rare earths are only a trivial portion of their complete scheme; the Chinese are cunning and patient. Their proceedings in the past few decades were very methodical. E. g. when they had started to manufacture solar panels, their products were cheap, of poor quality and low efficiency. In time they managed to improve the quality of their products at low labor costs and slowly became a serious competitor on the world market. The missing know-how and expertise were gained through acquisitions of previous contenders in Europe and USA that were no longer able to cope with the changing market situation. Many companies in Germany were forced out of business and were bought up by the Chinese.
The same methods are running parallel on the automobile market. If European and American car companies are not extremely careful, they will undoubtedly suffer the same fate as the a. m..


but this material is exported
Not profitable to refine


@ SJC:
Either you underestimate - or you don't understand the situation as described.


It's the latter, yoatmon.  Same as always.


“The U.S. does have very stringent regulations concerning human health and environment — as we should have — but that often makes our production more expensive,”
not profitable


the U.S., with its 1.4 million-ton reserve,
remains home to one of the largest rare earth deposits in the world.

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