From Mine to Market to Magnet: Molycorp & Arnold Announce JV
So it's finally happened: earlier this week Molycorp Minerals, LLC and Arnold Magnetic Technologies announced that they had signed a Letter of Intent to form a Joint Venture for "the production of Rare Earth magnets in the United States". Such a JV would be the end beneficiary of Molycorp's recently stated goal of moving "forward to reestablish domestic manufacturing capacity on an expedited basis" of rare earth ore mining at its Mountain Pass, CA facility.
In recent months there has been much speculation within the permanent magnets industry as a whole, regarding a possible move of this type - the only real surprise is that it has happened so quickly. Molycorp had made little secret of the fact that it was looking to step things up; this most recent announcement comes less than a month after Molycorp announced that it had broken off discussions with Great Western Minerals on acquiring a controlling interest in that company.
While the press release does not actually specify neodymium-based [Nd-Fe-B] versus samarium-based [Sm-Co] magnet material production, if the JV moves forward it would likely lead to the revival of production of sintered Nd-Fe-B permanent magnets in North America. This would be a capability that has not existed here in a number of years. How it will affect the price and delivery of Nd-Fe-B coming out of China, the predominant source of such materials [both in ore and finished magnet block form], and out of Japan and Germany, remains to be seen. .
This move certainly makes sense on the part of Arnold, which has historically produced rare earth magnets both in the US and at its subsidiaries in Europe that it had acquired over time. Arnold would appear to have the physical capacity across its various US facilities, to handle production. Of course, it will be no mean feat to ramp up to production levels; the actual timeframe for the JV to come to fruition remains to be seen.
This is going to be a most interesting time for the permanent magnets industry in North America. I wouldn't be surprised if we see other, similarly significant announcements pertaining to Nd-Fe-B & Sm-Co production, in the near future.
