Rare Earth Transparency is an Economic ImperativeRare Earth Transparency is an Economic Imperative

Rare earth elements (REEs) such as neodymium, praseodymium, dysprosium, and terbium are key ingredients of permanent magnets, which are found in many devices and products from data centers and wind turbines to cell phones, electric vehicles (EVs), and power tools. They are vital to developing the critical infrastructure that supports global industries, especially amid the urgent shift to clean energy technologies.

The challenge? China currently dominates the world’s supply of REEs and global demand is projected to increase almost sevenfold over the next decade[1], surpassing the anticipated supply. To meet this need responsibly, companies are turning to recycling as a resilient and sustainable local source that aligns with environmental and social values. Increasingly, REE recycling is also important for economic security and compliance with global regulations, including Europe’s Critical Raw Materials Act (CRMA) and the End of Life Vehicle Regulation Proposal (VRP) which have stringent targets for sustainable material sourcing and circularity.

The reality is less than 1% of REEs[2] are recycled today, but new technological advancements are about to change that. And as REE recycling ramps up, these supply chains must be traced end-to-end to prove the origin of these critical materials, ensure regulatory compliance, and unlock circular economy business models that are powerful for achieving economic goals.

New technologies and sustainable processes for recycling REEs

Recycling rare earth elements (REEs) has long been considered out of reach, with most attempts resulting in low recycling efficiency and high loss of key materials. Thanks to breakthrough innovations, we can now recover REEs efficiently, turning an impossible task into a sustainable solution. With growing financial support from governments, companies developing new permanent magnet recycling technologies have notably received over $248 million of private funding to date, demonstrating strong investor support as REE recycling infrastructure scales globally.

Innovative approaches to procuring and transforming these critical materials are further enhancing the value proposition. For example, Cyclic Materials just completed a rigorous lifecycle analysis of its mixed rare earth oxides (MREOs), which are REEs returned to their powder, raw material form. Cyclic Materials' proprietary Mag-Cycle™ and REEPure™ technologies are the first in the world with the capacity to separate magnets from end-of-life products and then convert the magnet product to MREOs and other valuable raw materials. The lifecycle analysis showed a 65% reduction in climate change impact by looking at categories including Climate Change, Resource Use – Fossil Energy, Resource Use – Minerals and Metals, Freshwater Ecotoxicity & Water Scarcity. The company’s two-phase recycling process uses 63% less carbon and 95% less water compared to traditional mining.

Not only is the quality and recoverability of the recycled materials improving but so is the market for the feedstocks. This creates a significant economic opportunity for companies to extract maximum value from their products and reduce costs and Scope 3 Greenhouse Gas emissions. In turn, REE recyclers need to prove responsible and sustainable practices to demonstrate their commitment to high ESG standards and differentiate their products on the market.

The road to ensuring end-to-end traceability of REEs

Cyclic Materials and Circulor have started working together to implement the world’s first end-to-end traceability of MREOs. This includes material traceability, as well as embedded emissions tracking and digital product passport (DPP) attribution to Cyclic’s recycled rare earths–managed through Circulor’s PROVE platform. This partnership sets a new standard for supply chain traceability and signals a shift toward more responsible, sustainable, and transparent REE recycling and marketing therefore giving confidence to the consumers of the critical materials for sourcing and procurement.

Circulor collates granular production, traceability, and carbon emissions data from Cyclic Materials’ facilities in Kingston, Ontario, to create a digital product passport for Cyclic Materials’ recovered MREOs that provides transparency to consumers and manufacturers, including proof of recycled content specifics and the origin of the material. Together, they sequentially collate data from subsequent facilities planned across North America and Europe. This means that the automotive, renewable energy, and consumer electronics industries have verifiable proof that the MREOs they receive from Cyclic Materials are produced at high standards that meet the CRMA and VRP regulations in Europe and regulations expected in the U.S.

But this is bigger than complying with labeling and circularity regulatory requirements. Establishing an immutable and reliable digital chain of custody for MREOs brings credibility to the recycling industry and streamlines the use of recycled MREOs. This establishes local REE supply chains that are competitive on a global scale—in other words, REE recycling becomes profit-making.

What’s on the horizon

Right now, REE recycling and traceability are in their early stages. For a glimpse at how they will advance, take a look at EV batteries.

Both permanent magnets and batteries face challenges related to resource scarcity, supply chain disruptions, and environmental concerns. With the first generation of EVs reaching the end of life, battery recyclers have received billions of dollars in public and private investments that they’re now putting to work. As a sign of how far the industry has come, the world’s first EV battery passport recently debuted on Volvo Cars’ EX90, which contains data on the origins of the raw materials, components, recycled content, and the embedded carbon footprint.

Now the same level of investment is happening for REEs. REE recycling infrastructure is helping companies further mitigate risk, reduce costs, and secure a more sustainable, and local, critical materials supply. The recent achievement of the world’s first end-to-end traceability of MREOs sets a critical example of how economic security in rare earths will come to fruition. 

To learn more and connect with Cyclic Materials, visit cyclicmaterials.earth/recycle-with-us.

To partner with Circulor, visit https://circulor.com/partners.

[1] Adamas Intelligence. Rare Earth Magnet Market Outlook to 2035, Q2 2022.

[2] International Energy Agency (IEA)