Next big industry: Rare earth elements

That’s right, the headline is correct. One of the next big industries to watch for in the next few years is rare earth elements, also known by their acronym, REE’s. These are elements that are not actually rare as their name suggests, but they are not generally found in concentrated deposits like other mined elements. This means that it is tougher to be profitable from them because you can’t just dig a big whole in the ground and find a large amount of it. Instead they tend to be a little more scattered throughout the area. So in reality, they are a bit rare because not many people currently mine for them.

However, that is about to change. Currently, China dominates this mining industry controlling about 95%-97% of the market. A side note to this story is that China saw the potential of these materials 30 years ago and invested in development. They deserve a lot of credit for that foresight. You would normally expect this type of entrepreneurial thinking from the US, Japan or Western Europe so that shows that other countries can sometimes make good, entrepreneurial decisions too, but I digress.

The reason this industry is set to leap in the next few years is because China has said that they plan to hold these materials within their borders for their own use. Moreover, demand for these materials are expected to increase by 60% in the next 5 five years. These metals are used in a vast number of products like missile guidance systems, cell phones, solar panels and the list goes on and on.

These are some of the rare earth elements, clockwise from top center: praseodymium, cerium, lanthanum, neodymium, samarium, and gadolinium.

These are some of the rare earth elements, clockwise from top center: praseodymium, cerium, lanthanum, neodymium, samarium, and gadolinium.

Canada stands to be one of the biggest beneficiaries from this emerging industry as it is said to hold about 56% of all potential REE deposits outside of China. This can mean a lot of money for Canada and a lot of jobs as well. Americans can indirectly benefit from Canada’s resources in this field as well because they might be able to get a job in Canada for one of the companies in this industry and they will also benefit from a reliable supplier for their imports. I assume the US has some potential deposits of REE’s as well, but I have no information on that right now.

For anyone looking for a job or looking to enter a whole new industry, this might be something you want to look in to more seriously as there are a number of companies in Canada (and likely in the US as well) that are or will soon enter this industry by exploring, financing, mining or refining these rare earth elements. It is very interesting to discuss the prospects of a whole new industry because it certainly does not happen every day. It’s also exciting because a big chunk of the potential is right in our own backyard (well, I guess only if you live in Canada or the US). If any news on this new and emerging industry comes up, I will follow up on it.