Although rare earths are essential for myriad industries, from EVs to washing machines and fighter jets, China’s longstanding stranglehold over 90% of the supply chain has deliberately kept prices low to stave off competition. It meant that when Lacaze green-lighted her “Lynas 2025” expansion project in 2019, prices of the benchmark light rare earth alloy Neodymium-Praseodymium (NdPr) were just $35/kg, leading many naysayers to scoff the $1.5 billion investment would pay off.
In recent months, Lynas has also inked a 10-year price floor of $110/kg of NdPr with Japan and partnered with two South Korean companies to build rare earth alloy and magnet plants in Vietnam and Malaysia respectively. It’s a flurry of activity that has propelled the Perth-based company’s value to soar 30 times over the past decade to $15 billion today.
TIME sat down with Lacaze at Lynas’s rare earth processing plant in Kuantan, Malaysia, to discuss the current state of the rare earths industry.
The Trump Administration has introduced initiatives like FORGE and Project Vault to try to diversify the global supply chain. How important is the new emphasis the U.S. government is putting on this issue?
Additional government policy support is a really good idea. There does seem to be a bit of a fashion at present to hope that if you throw enough money around that something will stick and come out of that. We typically advocate to governments that we would prefer policies that foster a successful industry, rather than trying to pick winners. And so, we do want there to be a larger, more robust outside-China industry, but we think that that must be as a result of government setting policies that allow companies to be successful, rather than trying to underwrite companies to be successful.
Regarding picking winners, some would argue that the recent price floor awarded to Lynas and MP Materials is exactly that. What do you say to critics who worry that this jeopardizes the diversification of a broader industry by giving a preferential treatment to two companies?
Is the current rare earths crunch something that you foresaw many years ago and planning to eventually exploit?
The Trump Administration has been trying to build a coalition of partners to diversify the rare earths supply chain. But at the same time, there's been a lot of aggressive rhetoric from President Trump, recently telling allies worried about energy disruption from the Iran war to ‘go get your own oil!’ Are you confident that partnering with the U.S. government is reliable?
China has restricted the export of rare earths but also the technology and talent for this industry. How challenging has that been to deal with?
This Kuantan plant has expanded by 50% in recent years, I understand. What is your goal and time frame for expansion going forward?
While there’s a great deal of activity to ramp up rare earth refining, is the next bottleneck going to be production of the rare earth magnets and how is that issue solved?
What’s the timeline on the proposed plant in Seadrift, Tx., given that you're expanding so much here?
This Lynas plant in Kuantan has been subjected to protests in the past regarding social and environmental impact on the community. Are you confident that won’t be a concern going forward?
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