The neodymium magnet market is set to experience a robust compound annual growth rate (CAGR) of 4.15% by 2028, reaching a market size of $3.307 billion from $2.487 billion in 2021.
The driving force behind this growth is the expanding application of neodymium magnets in consumer electronics. These powerful magnets find utility in minimising automotive parts, including power tools, sensors, and various components.
The recycling of neodymium holds the key to reshaping the industry. Initiatives like the Traverse Wind Energy Center, Aviator Wind Project, and Goodnight Wind Energy Project underline the increasing need for neodymium products. However, the energy-intensive production process, particularly fluoride-based fused salt electrolysis, demands a substantial amount of energy. With rising energy prices, this factor could significantly impact market expansion.
Renewable Energy's Beacon
As global interest in renewable energy rises, so does the demand for neodymium magnets. The surge in wind electricity generation, with a record-breaking 273 TWh in 2021, reflects the momentum. Plans to achieve Net Zero Emission by 2050 further bolster the forecast, projecting 7,900 TWh of wind electricity generation in 2030.
Automotive Industry Driven Growth
The automotive sector plays a pivotal role in the neodymium magnet market. These magnets have become integral to electronic systems in vehicles, including energy transfer, electronic control units, multimedia systems, and safety features. The development of lightweight, intelligent, and electric cars has fueled demand. In 2021, electric car sales, including Battery Electric Vehicles (BEVs) and Plug-in Hybrid Electric Vehicles (PHEVs), surpassed 10 million units, marking a 55% increase from the previous year.
Technological Innovations In EVs
Advancements in electric motor technology, particularly the integration of innovative neodymium magnets, are poised to be a driving force in the market. The US Department of Energy predicts that 90% to 100% of battery and hybrid electric vehicles will incorporate synchronous traction motors with neodymium iron boron magnets by 2025. The global demand for neodymium magnets in EV applications is set to skyrocket, reaching 266 thousand tonne by 2050.
The Asia-Pacific region, particularly China, stands out as a significant player in the neodymium magnet market. With large reserves, low production costs, and supportive Government policies, China leads rare earth magnets' production. In 2022, China's rare earth mining saw a 25% increase, reaching 210,000 tonne. The growing domestic and international demand for rare earth magnets, especially neodymium, continues to propel China's rare earth production, contributing to the market's growth.
The neodymium magnet market's trajectory is undeniably influenced by technological innovations, environmental considerations, and the global push towards sustainability. As industries continue to evolve, neodymium magnets emerge as a linchpin in shaping the future of diverse sectors.
Courtesy: ResearchAndMarkets. Photo is representational.