According to media reports, the mining of rare earths in Myanmar has currently been interrupted. As the country is of global importance, particularly in the area of heavy representatives of this element group, the effects could be reflected in higher prices.
Around half of the heavy rare earths such as terbium are mined in Myanmar, but a shortage is now apparently looming, as the Chinese Global Times reports. Mining activities in the neighbouring country have currently come to a standstill, reports the newspaper, which is considered close to the state.
Geopolitical risks in Myanmar
Myanmar mainly exports medium-sized Rare earths such as gadolinium as well as heavy representatives of this group of raw materials to China, where they are further processed. The latter elements include terbium, for example, which increases the performance of rare earth magnets. The demand for magnets is constantly increasing in application areas such as electromobility, wind power and consumer electronics.
The most important source of heavy rare earths are ion adsorption stones, which are only mined on a large scale in these two countries. Around half of the world's heavy rare earth production comes from Myanmar, which has been ruled by a military junta since February 2021. Various rebel groups have formed resistance to this. This is probably also the reason for the current apparent idling of the mining industry. One of the armed groups, the Kachin Independence Army, or KIA for short, had according to the news agency Reuters reported that it had taken control of an important mining centre for rare earths in the north of the country. This region, Kachin State, where mining of the critical raw materials is concentrated, borders directly on China, and the much larger neighbouring country, which has already tried to mediate between the conflicting parties on several occasions in the past, is correspondingly alarmed. This week, the junta leader is expected to attend talks in China, which will focus on improving bilateral relations, among other things. In addition to the political disputes, Myanmar is also suffering from heavy monsoon rains this year, with the non-governmental organisation ACAPS saying that Kachin State is particularly affected.
Keeping an eye on possible developments
TRADIUM expert Jan Giese summarises the possible consequences of the current situation: "The latest mine closures in Myanmar could lead to a shortage of rare earth metals, as was already the case in autumn 2023, and thus result in price adjustments. Due to Myanmar's significant role in mining and China's near-monopolistic influence in processing, even minor changes in supply can have a noticeable impact on the supply chain. Although the market situation currently remains relaxed, buyers and market observers should keep an eye on developments and prepare for possible scenarios.
We highlighted the importance of Myanmar for China's rare earth industry in a market commentary last December. The report, published in collaboration with the news portal Rawmaterials.net created You can find the article here.
You can find more detailed information on the mining regions, areas of application and price trends for the rare earth metal group on the SelteneErden.de website. Feel free to take a look!
