Highlights
- European yttrium prices surged +3,000% due to market shortages further to the April 2025 Chinese export controls
- Inclusion of yttrium in Phalaborwa's SEG+ mixed rare earth product could add +US$30 million to the project's annual estimated EBITDA
- Yttrium is used in the aerospace, energy and semi-conductor industries and is critical to certain defence applications
Rainbow Rare Earths notes the recent reports on the surge in pricing and importance of yttrium, a rare earth element that will be included in the Phalaborwa project's SEG+ product, which is a mix of all the economically important medium and heavy rare earths. As recently announced, yttrium is now included in the Phalaborwa resource and the project is expected to produce ca. 213t yttrium oxide per annum as part of the high-purity, mixed SEG+ product.
According to data from Argus Media, the price of yttrium oxide 99.999% Cost, Insurance, Freight (CIF) Europe started the year at ca. US$6/kg but it has risen to current levels of between US$220/kg to US$320/kg (the large spread is due to differing pricing contracts). This surge in pricing is due to the issues around export of the metal from China further to the imposition of export controls in April which have led to major supply chain disruption and shortages in the market.
These shortfalls have highlighted how extensively used yttrium is across civilian high-tech and defence applications.
The pricing increase causes a material positive impact on Phalaborwa economics, with the potential addition of +US$30 million to the project's EBITDA at today's lower range of the European price, based on a conservative SEG+ payability of 70%.
George Bennett, CEO, commented: "The disruption and huge price increase for yttrium has once again highlighted the fragility of global dependence on China for strategic minerals, especially those like yttrium that are essential to high-tech and defence manufacturing. Phalaborwa is a stand-out project in the rare earth space because it is a near-term and low-capital intensity source of all the economically and strategically important rare earths, including the heavies such as yttrium. This price increase positively impacts annual estimated EBITDA for Phalaborwa as there will be no extra cost to produce it as part of our proposed SEG+ product."