Keynote: Vulnerabilities and opportunities in the sintered NdFeB supply chain for meeting U.S. decarbonization goals

In February 2021, President Biden signed Executive Order 14017 on America’s Supply Chains (EO14017), directing federal agencies to identify and evaluate potential challenges and opportunities facing key supply chains and propose potential policy solutions to address them. As part of this effort, the Department of Energy (DOE), in partnership with the national laboratories, conducted evaluations of the supply chains that encompass the Energy Sector Industrial Base, with a particular focus on technologies required to decarbonize the U.S. economy by 2050. One of these reports focuses on the rare earth permanent magnet supply chain, specifically that for sintered neodymium-iron-boron (NdFeB) magnets, for their prevalent use in traction motors in electric vehicle propulsion systems and direct drive synchronous generators in offshore wind turbines.

Under aggressive decarbonization scenarios, such as those striving toward net-zero carbon emissions by 2050, demand for sintered NdFeB magnets is expected to grow rapidly, both domestically and globally. This demand poses a significant and undeniable challenge to U.S. decarbonization goals because rare earth magnets (and the materials they contain) are characterized by substantial market volatility and geopolitical sensitivity. Markets for rare earths are opaque as they are produced as co-products and often sold via contractual relationships. Nearly all supply chain stages are concentrated in China and the chemistry associated with processing rare earths is challenging, expensive, and hazardous. Furthermore, substitution is difficult throughout the supply chain due to the unique characteristics and technical advantages of NdFeB magnets.

This presentation will give an overview of DOE’s 1-year report on the NdFeB magnet supply chain in response to EO14017, highlighting:

• The importance of the sintered NdFeB supply chain to decarbonization goals;

• Key stages and processes in the sintered NdFeB supply chain;

• The concept of supply chain resilience and why it matters;

• Current vulnerabilities in the sintered NdFeB supply chain to meet climate goals;

• Opportunities in the NdFeB supply chain for the United States; and

• Efforts underway both domestically and globally to improve the robustness of the NdFeB supply chain to future disruptions.

While improvements in recent years have increased domestic production capacity and diversified foreign supply sources, the supply chain of rare earth elements and magnets is still not resilient to disruptions and establishing a resilient domestic magnet manufacturing industry will require restoring U.S. competitiveness in multiple stages of the supply chain.



Braeton James Smith

Principal Energy Economist
Argonne National Lab