Terbium Prices

Terbium Price Forecast

Due to terbium’s increasing use in high-tech components such as high-temperature fuel cells (in electric cars!!) and permanent magnets (in wind turbines), experts, such as The Fraunhofer Institute for Systems and Innovation Research, predict demand far exceeding supply.

Between 2017 and 2022 Terbium increased more in value than any other rare earths, as shown in the Bloomberg chart below:

Terbium increased by a massive 354% between January 2017 and December 2021, which was about 70% per year. 2022 still saw a price increase of 21.75%, mainly driven by the fact that Europe accelerated its transition to greener energy to wean its dependence on Russian oil and gas as quickly as possible after the invasion of Ukraine. Last year saw a correction in the price of terbium, which had increased by double-digit numbers over the past five years.

However, the demand for terbium has yet to peak. Analysts from the Fitch credit rating agency recently stated that the demand for energy transition metals would peak by the 2040s when they anticipate the bulk of the global low-emissions infrastructure will have been built.

But remember that China dominates terbium and other rare earths’ production, extraction, refining, and supply. It has taken them 30 years to establish this position, and we now live in the reality that the US, EU, and other developing nations need to wait in line to see what China exports after they have satisfied their domestic needs.

We cannot overstate the importance of China’s position. It is almost inconceivable to think that one country produces more than 99% of a raw material so critical to every nation’s economic prosperity and military capabilities.

We are now facing the likely unintended consequences of globalization. For the past three decades, the world has been high on the “drug” of globalization. The reality is that China can economically weaponize the supply of terbium and other rare earths. For example, they have done so in the past during a territorial dispute with Japan in 2010.

In August 2023, China started restricting the export of two vital technology metals, gallium and germanium. It is a retaliatory measure against the US for blocking the most advanced computer chip technology from getting to China. Tensions are manifest and escalating.

As an industry supplier, we can inform you that China already has plans to restrict the export of terbium, dysprosium, neodymium, and praseodymium before the end of this year. If and when that happens, demand and price will increase as nations and corporations rush to stockpile.

China also has its own plans for electric cars, having doubled its production last year alone, and also aims to move up the value chain in solar and wind power now its supply chain dominance is established. Hence, there will be shortages, and further terbium price increases are predicted as demand continues to rise while supply is restricted.

The EU is already aware of this, stating that rare earths are fast becoming more important than oil and gas. So, the prospects for investors holding terbium as a physical asset should be very good in the medium, and long term, while the recent price correction may offer an interesting opportunity for investors wanting to add this vital raw material to their portfolio.

The 10-year forecast graphs below, by Argus Media, show Terbium’s future price (fob China), demand, and supply estimates.