The moves to support production of rare earth permanent magnets would mirror legislation introduced in the United States earlier this month to offer tax credits to makers of the devices there.The United States, the EU and Britain aim to expand output of the super-strong magnets used in electric vehicles and wind turbines to help meet targets to cut carbon emissions and lessen dependence on China, whose producers currently dominate the global sector.
"If we're going to invest our own capital, we will need to see a coordinated effort where our portion of the capital will attract a sufficient return," said Constantine Karayannopoulos, chief executive of Neo Performance MaterialsNeo owns the only commercial rare earth separation facility in Europe and is prepared to build a $100 million permanent magnet factory in Estonia, Karayannopoulos added.
A Chinese rare earths industry official said the country's policy of encouraging export tax rebates for magnets has a long history and the ultimate beneficiaries are end users. European attention is now shifting to the minerals used in permanent magnets, demand for which is due to surge as much as tenfold by 2050, when the EU and Britain have pledged to cut net greenhouse gas emissions to zero.
A viable magnet industry in Europe would also need the support of customers, such as automakers, who must agree to pay a slight premium to be guaranteed an environmental and traceable product, the sources said. "Chinese permanent magnet producers get raw materials at 25% below the price I can get them," said Bernd Schleede, head of permanent magnets at VAC.
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