Neodymium-iron-boron (NdFeB) permanent magnets are high-performance magnets made of rare earth elements (REEs), and they serve as key building blocks for virtually all technologies that rely on an electric motor. They power critical national security systems, such as fighter aircraft and missile guidance systems, as well as clean energy technologies such as electric vehicles, hydroelectric power stations, and wind turbines. The magnets are also used in other essential electric technologies such as computer hard drives, MRI devices, refrigeration systems, and audio equipment.  

The United States once led the world in rare earth element and magnet production, however, China has come to dominate the global supply chain over the last three decades. Currently, China controls 60% of mined production, over 85% of processing capacity, and over 90% of magnet production. Given the critical function of both REEs and NdFeB magnets to an array of essential technologies, China’s growing monopoly marks a significant threat to U.S national security, economic strength, and competitiveness in the global economy. 

In February 2021, President Joe Biden made clear the need to address vulnerabilities in critical materials supply chains by signing Executive Order 14017 on America’s Supply Chains. The Order required a 100-day review of the supply chains for critical materials, including REEs. Additionally, the U.S. Secretary of Commerce was directed to launch an investigation under section 232 of the Trade Expansion Act of 1962. Last month, the investigation ultimately confirmed that NdFeB magnet imports threaten national security, as defined by the section 232 statute. 

The Secretary’s report on the investigation concludes that the U.S, along with our allies and partners, remains highly reliant on imports from China. While the Biden Administration has already invested more than $200 million to increase domestic rare earth element separation capacity and NdFeB magnet manufacturing, the report demonstrates that there is still much to be done to effectively wean our dependence on China. Notably, the investigation revealed that America’s nascent NdFeB magnet industry still faces considerable barriers to reaching its production targets despite recent investments. These barriers are likely to become increasingly difficult to overcome as U.S NdFeB magnet consumption is forecast to more than double from 2020 to 2030 as a result of increased demand for electric vehicles and wind power. 

Despite these challenges, Noveon Magnetics remains committed to building a domestic industry that can overcome longstanding supply chain volatility and geopolitical risk and usher in an electric future that is Made in America.