expects these demand increases to influence some users to use less material or find alternatives.
Additives Subtracting Rare earth element isn’t just a
catchy name, at least for U.S.-based manufacturers. Te 17 metals classified as such are so scarce in the country, researchers have begun searching for them in extraterrestrial locations. Ac- cording to scientists at NASA’s Lunar Science Institute, the metals may exist in abundance on the surface of the moon, and the institute is looking into the prospect of mining them. While most ductile iron casters
aren’t looking to the moon just yet, their balance sheets have been affected by rare earth elements. For years, the existence of the materials in gray iron inoculants and ductile iron magne- sium ferrosilicon pre-blends at low levels (about 1-3%) flew essentially under the radar, mitigating the effects of tramp elements without spiking prices. But now, with demand rising and supply remaining static, the price of the goods is steadily increasing, and metalcasters are taking notice. “At this point in time, we have had no issues with deliveries of magnesium ferrosilicon alloys, but our suppliers keep talking to us about the rare earth situation and [saying] that delivery is- sues could come up,” said Larry Helm, quality control manager for Seneca Foundry Inc., Webster City, Iowa. “As the supply gets tighter and tighter, something is bound to happen.” Te market for rare earth metals has
thrown a double whammy at metalcast- ers. Not only is an estimated 95% of the material found within Chinese borders (notwithstanding pending discoveries of the material on the ocean floor and several other places), but several end- use applications for the materials are growing by leaps and bounds, includ- ing the batteries found in hybrid and electric vehicles. Te emerging markets are gobbling rare earths up faster than China can pump them out. “Many [rare earths] are used in a host of things, from electronics to pol- ishing compounds in glass,” said Fred Linebarger, the director of technology for melt materials provider Miller and
Sept/Oct 2011 | METAL CASTING DESIGN & PURCHASING | 25
Co. LLC, Rosemont, Ill. “[Te market change] has happened so quickly and to such an extent, the costs of the met- als is greater than an order of magni- tude higher, in some cases 20 times the price of what it was before.” Because rare earths make up only a
fraction of the treatment alloys ductile iron casters buy, this does not translate to nearly such exorbitant price hikes at the foundry or extreme surcharges for the ends-user. Helm said his compa- ny’s costs have increased roughly 20% this year. Peaslee reports his company has seen an 88% increase in the cost of its magnesium ferrosilicon over the past three years. “We used to get fairly stable pric-
ing for six months to a year. Now, [our suppliers] re-price quarterly,” Peaslee said. “Ferrosilicon is re-priced monthly. Tey will not guarantee pricing. If you call someone up now and ask to enter a long term contract, all you hear is chuckling.” Most metalcasters surveyed have
not reported an actual lack of avail- ability of materials containing rare earth elements. But at least one Penn- sylvania metalcaster reports that it has not been able to purchase some rare earth inoculants due to shortages or manufacturers discontinuing produc- tion. And Peaslee said his requests for an uptick in supply have been denied. Another facility (a ferrous manufactur- er in Wisconsin) has begun reducing the amount of cerium and lanthanum used in its treatment alloys. To offset the reduction, the company has had to purchase higher grade scrap melt materials, which are more expensive than the metal previously used. Linebarger said Miller and Co. is not having trouble making the prod- ucts available, but that could change. “If China continues to use more
than they can produce, there may be a potential shortfall for outsiders at any price,” he said. Rare earth materials aren’t the only melt additives that are rising in price.
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