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Rare Earths : The New Oil?

Rare earths have become crucial elements in the green economy of tomorrow as the world strives to reduce its dependence on hydrocarbons and achieve an energy transition.

terres rares

According to a report by Prescient Strategic Intelligence, global demand for rare earths is expected to grow at an average annual rate of 9.1% over this decade. This increased demand is largely attributed to their use in the manufacturing of magnets, which are essential in renewable energy, electric vehicles, and various electronic devices.

However, the reliability of rare earth supply has become a major concern. China currently holds a dominant position in the supply of these metals, raising concerns about the security of global supply chains. For instance, the European Union estimates that demand for rare earths for magnet production could increase tenfold by 2050 to support its energy transition.

In comparing rare earths to oil, the relevance is clear, as they have become essential elements in our pursuit of sustainable energy solutions. Questioning whether rare earth operators could become the new oil companies is entirely legitimate. Western countries, aware of their dependence on China in this field, have begun taking measures to reduce vulnerability.

In the United States, the Biden administration has implemented significant measures to boost domestic rare earth production, notably through the 2023 Rare Earth Magnet Production Tax Credit Act. The reactivation of California's Mountain Pass mine by MP Materials is a tangible example of this effort to increase production and secure rare earth supply.

In Europe, the EU's Green Deal has identified rare earths as a raw material with a high supply risk. The recent discovery of Europe's largest rare earth deposit in Sweden offers a glimmer of hope, but the EU remains heavily reliant on Chinese imports.

In this context, it is crucial to explore investment opportunities in rare earths. Rising demand, the need for supply source diversification, and government initiatives supporting this industry make rare earths an attractive sector for investors. Companies like Elio Strategy are well-positioned to assist investors in navigating this complex and evolving market.

In conclusion, rare earths play a vital role in the global energy transition, and demand for these metals continues to grow. Excessive reliance on China for rare earth supply underscores the importance of diversifying sources and investing in this promising industry. Elio Strategy can help you seize investment opportunities in this expanding sector, destined to shape the future of clean energy and technology. Request your brochure at: www.eliostrategy.com/brochure.


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