An essential element of permanent magnets that are vital components of motors used in electric vehicles and wind turbines.
Dysprosium is a Rare Earth Element (REE) mainly used in the manufacturing of permanent magnets. These are essential components of wind turbines and electric vehicles, thus making dysprosium critical to the energy transition. China dominates dysprosium extraction and refining, creating a strategic advantage and contributing to the establishment of the metal as a critical material for both the United States and European Union. Myanmar is also a major source of dysprosium, which creates a supply chain resilience risk due to that country’s continuing political crisis.
TDi’s ESG data indicates that dysprosium has a very low perceived exposure to ESG risks, with pollution the only issue with a moderate association. This low perceived exposure is likely to be the result of dysprosium’s obscurity and due to REEs often being treated collectively in media and NGO reporting. However, scrutiny over the environmental impacts of REE mining in China is likely to increase. The establishment of new projects in countries such as Australia and Greenland is leading to opposition from community groups over perceived social and environmental risks. However, such projects in countries with relatively strong environmental controls would also lower the risk of downstream companies being linked to the major environmental impacts of REE mining in China and Myanmar.
Main Uses and Attributes
Dysprosium oxide is almost only used as a key component of neodymium-iron-boron (NdFeB) alloy permanent magnets. Dysprosium increases the alloy’s resistance to demagnetisation and improves its performance under high temperatures of up to 200°C.1https://rmis.jrc.ec.europa.eu/uploads/CRM_2020_Factsheets_critical_Final.pdf
NdFeB magnets are used in electric motors and generators, with applications in electric mobility, industrial robots, pumps, consumer appliances, and electronic goods with additional uses such as in smartphone speakers.2https://www.fairphone.com/wp-content/uploads/2017/05/SmartphoneMaterialProfiles_May2017.pdf These magnets are also vital parts of wind turbines generators and the motors for hybrid, plug-in and pure electric vehicles.
Supply Chain Risk
TDi assesses Dysprosium for key risks affecting the security of supply, and for its association with artisanal and small-scale mining.
Country Governance Risks
Dysprosium's association with countries experiencing: