Secular Market The history of hard magnet material began to unveil in the 1930s, as an improvement over steels was found, in a group of alloys commonly referred to as the Alnicos (nickel, cobalt and iron with small amounts of aluminum, copper and titanium). Although the Alnicos are still used to manufacture magnet products today, they are far less common because of the many disadvantages in specific forms they must undergo as well as production that they hold. In the 1950s they discovered a low cost hard ferrite often termed, ceramic magnet. Unlike the Alnicos, this hard magnet, or permanent magnet material, was much easier to produce. In 1967, while conducting research for the United States Air Force, Dr. Karl Strnat discovered SmCo (samarium cobalt) at Wright Patterson Air Force Base. This was the first time that a Rare Earth (RE) and Transition Material (TM) were put together for commercial production. It wasn’t until 1984 that a major breakthrough occurred that led to an industrial rise in the production of the highest energy product of all magnet materials. Two inventors are credited for discovering NdFeB (neodymium-iron-boron), Japan’s Sumitomo Special Metals and the United States’ General Motors. John Croat, worked for GM who then formed the Magnequench division in the late 80’s.1 At the peak of production, the U.S. was employing thousands of workers in 15 of their strongest magnet manufacturing facilities. Although business was still good for Americans, the magic of magnets was going global. “In 1990, worldwide magnet production was 300,000 metric tons, with sales valued at roughly $2 billion. United States production comprised over 50% of these totals.” As the decade continued, China began discovering rare earth deposits in Inner Mongolia near Baotou and other areas and from 1994 to 2001 their market share rose from 47% to 82%, leaving the U.S. with a mere 6%. Competition from China continued to rise and forced closures, buyouts and acquisitions taking the United States magnetic production workforce from a hearty 6000 workers to a dim 510. The only U.S. rare earth mine located in Mountain Pass, California, was forced to close in 2002. Magnequench’s plant, former GM subsidiary, closed in 2003 and sold their operations to China. The fight was quickly over in 2005, when NdFeB ceased production on U.S. soil with the closure of the Hitachi plant in Edmore, Michigan. Australia soon had to follow suit, in 2009, closing its Mount Weld mine and selling operations to China.
There is still a lot of use and potential for SmCo but it has become very expensive to obtain. Samarium is one of the most difficult light rare earth elements to find in addition to Cobalt’s limited sales due to its classification as a “strategically important metal.”1 Due to ease of processing and the low cost of raw materials, ceramic magnet materials are the most widely used permanent magnet materials, but has become virtually extinct in the U.S. due to low labor costs in China, which is why only one company exists in today’s U.S. market.3 China carries 85% of the hard ferrite production. The other existing American companies are comprised of 3 Alnico producers and one SmCo producer, which make up 65% of the Chinese magnet material market. 2
“Today, nearly 100% of the world’s rare earth metals and over 94% of rare earth oxides come from china.”2 With these ratios, the United States is at a clear disadvantage and it becomes understandable why the shift in sales took a downward direction for Americans over the past decade. Despite the hard economic times faced globally, NdFeB magnets are still seeing a positive growth rate of 12%-20% depending on the processing method. Sintered NdFeB magnets has a 12% growth rate and bonded NdFeB magnets has a 20% growth rate. Because of its core use in computers, hard magnets are now worth more than soft magnets, especially for the use of voice-coil-motors (VCMs). 1
As of August 9,…