Global Rare Earth Metals Market Assessment, By Element [Lanthanum, Cerium, Dysprosium, Erbium, Europium, Gadolinium, Holmium, Lutetium, Neodymium, Praseodymium, Terbium, Yttrium, Others], By Application [Magnets, Glass, Ceramics, Catalysts, Metallurgy, Po

Global rare earth metals market is projected to witness a CAGR of 7.02% during the forecast period 2025-2032, growing from USD 5.72 billion in 2024 to USD 9.84 billion in 2032. The rare earth metals market has experienced significant growth in recent years due to escalating demand for advanced consumer electronic technologies, and rising investment in clean energy solutions is expected to maintain a strong pace of expansion in the coming years. The rare earth metals are a collection of various elements that possess specific characteristics which enables them to be utilized in the production of high-performance magnets, catalysts, batteries, and other advanced alloys. The rare earth metals are utilized to provide power for the motors in EVs and wind turbines in wind power plants, which increases the performance. The increased demand for electric vehicle adoption and the expansion of renewable energy initiatives, particularly wind and solar projects, has significantly increased the demand for elements such as neodymium, dysprosium, and terbium, which are very important in efficient motor and turbine performance.

For instance, In July 2025, Sona BLW Precision Forgings Limited decided to establish a new production plant for manufacturing rare earth magnets in India, intended for use in electric vehicle motors. Production is expected to begin by the end of 2025. This development will help India to reduce import from China for the critical components.

Furthermore, the rare earth metals are being used in the manufacturing of products for the consumer electronics and defense systems industries which propel its demand in the market. Additionally, the relentless innovation in consumer electronics and the integration of artificial intelligence and innovative technologies continue to fuel market expansion. Nevertheless, ongoing investments in exploration, recycling, and supply chain diversification are expected to support sustained growth in the global rare earth metal market in the coming years.

Rise in Production of Consumer Electronics Goods Amplifying Market Growth

Globally, the rise in the production of consumer electronics is a significant actor driving the rare earth metal market. The modern electronic devices that are currently in the market or are upcoming in the coming years are driving the demand for high-purity rare earth metal products. Consumer electronics such as smartphones, laptops, televisions, tablets, and electronic wearables are all dependent on materials. Most of the smaller components of devices are made from rare earth metal material. Elements like neodymium, praseodymium, europium, terbium, and gadolinium are used to manufacture permanent magnets, phosphors, and chipsets, which are highly utilized in modern electronics devices. In addition, the increased demand for consumer electronics that are smarter, faster, and more efficient continues to increase demand for rare earth metals in the market. Several companies are increasing the production of rare earth metals to fulfil the increasing demand form the consumer electronics sector.

For instance, in April 2025, Solvay S.A. has decided to open its rare earths production line for permanent magnets at the La Rochelle facility, France which mark a significant milestone in the Group’s commitment to meeting Europe’s strategic goals. This expansion enables company to start delivering rare earth materials for permanent magnets, reinforcing its position as a global leader in the rare earths market in the coming years.

The upcoming technologies, such as artificial intelligence, quantum computing, and the next generation display technologies, enhance the application of rare earth metals for thermal conductivity, accentuate the color accuracy, and improve the image resolution. Additionally, the trend toward device miniaturization and improved battery performance in portable electronics relies on rare earth-based materials, which drive its demand in the sector. The interplay between technological advancement and rising consumer expectations for consumer electronics is expected to increase the demand for rare earth metals in the market. Several companies are increasing the production of rare earth metals to fulfil the increasing demand form the consumer electronics sector.

Adoption of Advanced Materials for Wind Turbine Components Manufacturing Creating Market Opportunity

Several manufacturers of wind turbine component are adopting the advanced materials to brings efficiency, reliability, and innovation in the wind power sector which is creating significant market opportunities for rare earth metals market. As with the rising wind plant size and power production capacity advanced turbines are required which could handle greater torque and operate reliably in harsh environments. Manufacturers are using advanced materials such as neodymium, praseodymium, dysprosium, and terbium to produce advanced wind turbine components. Moreover, the advanced turbines are efficient and made on direct-drive models that mainly rely heavily on high-strength permanent magnets, thus creating the opportunity for rare earth metals. In the developed countries manufacturers are investing in the production expansion to fulfil rising demand in the country.

For instance, in May 2025, Less Common Metals Limited (LCM) was looking to invest around USD 121 million to establish a production plant for both light and heavy rare earth metals and alloys. Currently, Lacq in France being considered as the location for the plant with a final decision due shortly This development highlights that companies are investing to boosts the production rare earth metals in the market.

Furthermore, the magnets which are used in the turbines offer superior magnetic strength, compactness, and resistance to demagnetization at high temperatures compared to conventional alternatives, which contribute to efficient energy conversion. The use of rare earth metals allows manufacturers to design turbines lighter, powerful, and require less maintenance, thus making wind energy more cost-effective and reliable. The advantages of rare earth metals in turbine manufacturing are widely spreading its adoption in direct-drive turbines, which are highly used in offshore wind projects. With the rising investment in the installation of wind farms will drive the demand for efficient wind turbines which are made from the rare earth metals, thus creating market opportunity in the forecast period.

Neodymium Segment Dominates Global Market

Neodymium is a critical material which has high-strength permanent magnets (NdFeB magnets) ability due to which its demand is increasing in the global market. The neodymium segment is experiencing rapid growth which is driven by its importance feature due which material utilized in clean energy sectors and manufacturing advanced technology. Electric vehicles (EV) motors, wind turbines (for renewable energy), and a large number of consumer electronic devices (smartphones, laptops, tablets, etc.) utilize neodymium magnets which makes the segment to dominate in the market.

Furthermore, with the adoption of EVs is pushing demand for neodymium magnets to support sustainable transportation options manufacturing in the market. Additionally, the switch to renewables is also advancing with a similar increase in demand for neodymium magnets to support wind turbine generator operations. Similarly, the adoption of new technology (i.e. smart devices, advances in AI) like 5G expansion creates a further demand for neodymium magnets in the forecast period. Lastly, the support provided by the government such as pushing for the adoption of green energy and innovations in technology boosts the market size of the neodymium segment in the market.

Dominance of Asia-Pacific Region in Global Market

The Asia-Pacific region dominates due to rising demand for electric vehicles (EV) and consumer electronics. The region has a large production capacity and customer base which makes the region to dominate in the market. Moreover, the region is the house of developing countries which continuously increase the demand for goods and services which boosts the demand for rare earth metals in the market. The China is the major producer and supplier of rare earth metals as country has abundant natural reserves, large scale infrastructure development, and comprehensive government initiatives, including notably export controls which makes the region to dominate in the market. Moreover, the country has spent heavily on extracting rare earth metals through downstream processes like refining also invested in production technologies eventually, finished products.

The region has a vertical integration supply chain of rare earth metals among companies which assist manufacturers efficiently meets the surging demand for rare earth metals from high-growth industries such as electronics, electric vehicles (EVs), and renewable energy. As global industries increasingly adopt smart technologies and green energy solutions, the Asia-Pacific region’s established infrastructure, technological expertise, and proactive regulatory environment ensure its continued leadership in the rare earth metal market.

For instance, in June 2025, As per a study published in the Chinese Academy of Sciences (CAS) as cited by South China Morning Post (SCMP), the country has come up with an innovative method which based on electric fields has managed to recover 95 per cent of rare earths, while simultaneously reducing mining time by 70 percent and cutting electricity use by 60 per cent which makes the country to dominate in the global market. In another instance, in 2024, China's domestic output of rare earths was 270,000 metric tons which is up from 255,000 metric tons from 2023. This development highlights that country is increasing the production of rare earth metals to fulfil the rising demand in the market.

Impact of United States Tariff on Global Rare Earth Metals Market

• Tariffs on Chinese goods triggered Chinese export restrictions on key rare earth elements, causing immediate supply chain disruptions for global manufacturers.
• Trade tensions and export controls led to sharp price increases and heightened volatility for rare earth metals, impacting costs across electronics, automotive, and defense sectors.
• Higher tariffs and supply disruptions raised input costs for the United States and global manufacturers, squeezing profit margins and raising consumer prices
• Shortages of critical rare earths forced delays in the manufacturing of EVs, wind turbines, and defense equipment worldwide.
• For instance, China’s Ministry of Commerce imposed export restrictions on seven rare earth elements (REEs) and magnets used in the defense, energy, and automotive sectors in response to United States tariff increases on Chinese products.

Key Players Landscape and Outlook

To increase revenue and market share, rare earth metal companies are investing in advanced refining technologies, expanding sustainable mining practices, forming strategic partnerships, and pursuing mergers and acquisitions. Companies are also developing vertically integrated supply chains, securing long-term offtake agreements, and diversifying geographically to reduce dependence on single markets and ensure robust supply. Product launches, agreements, business expansions, collaborations, and developing technologies are projected to increase competition in the fast-paced market.

For instance, in April 2024, MP Materials had received a USD 58.5 million as award to advance its construction of America’s first fully integrated rare earth magnet manufacturing facility. The award was given by Department of Energy under Section 48C Advanced Energy Project tax credit allocation was issued by the IRS. This development highlights that the government is also helping companies to integrate the supply chain and to increase revenue in the coming years.