"The U.S.-EU Trade and Technology Council (TTC) held its second ministerial meeting in Saclay – Paris, France on May 15-16, 2022. U.S. co-chairs, Secretary of State Antony J. Blinken, Secretary of Commerce Gina Raimondo, and United States Trade Representative Katherine Tai were joined by EU Co-Chairs European Commission Executive Vice Presidents Margrethe Vestager and Valdis Dombrovskis to review progress, meet with a range of U.S. and EU stakeholders, and advance Transatlantic cooperation and democratic approaches to trade, technology, and security that deliver for people on both sides of the Atlantic. "
"Trade and Technology Council Statement on Rare Earth Magnets 1. The Secure Supply Chains working group of the TTC has held exchanges since the TTC inaugural meeting in September 2021 in Pittsburgh to examine avenues for advancing transatlantic supply chain resilience and security of supply in key sectors. As part of the group’s initial focus on clean energy technology and critical materials, the working group members have shared views on supply chain mapping, vulnerabilities, and opportunities for collaboration on rare earth magnets. Rare Earth Magnets Are Essential to the Transatlantic Economy and Climate Ambitions 2. Rare earth magnets have many uses across a broad spectrum of applications, including wind turbines, electric vehicle drives, hard disk drives, cell phones, loudspeakers, industrial motors, non-drive train motors in vehicles, power tools, and electric bikes. Under decarbonisation scenarios to achieve net-zero carbon emissions by 2050, demand for rare earth magnets is expected to grow rapidly, both in U.S. and EU domestic markets and globally. In the implementation of its objectives of a carbon pollution-free electric grid by 2035 and a net-zero economy by 2050, the U.S. government has established targets of offshore wind capacity installations of 30 GW by 2030 and 100 GW by 2050. The United States has further committed to electrify the federal government’s vehicle fleet and achieve a 50 percent share of electric vehicles for all new passenger cars and truck sales by 2030. 3. The EU strategy on offshore renewable energy proposes to increase Europe’s offshore wind capacity from its current level of 12 GW to at least 73 GW by 2030, which corresponds to the installation of 7 GW per year. Overall, EU wind energy is expected to grow from 180 GW today to 451 GW by 2030. The EU market is expected to reach about 7 million of electric vehicles by 2030. 4. These targets/proposals coupled with projected rapid private sector demand could place substantial stress on underdeveloped supply chains without capacity expansion at all supply chain stages, further market development, and investment. 5. Rare earth magnets, and the rare earth materials they contain, have been prone to substantial market volatility and supply risks due to the high geographical concentration of production and geopolitical factors. Companies from the United States and the European Union do not have prominent positions in the supply chain nor large scale magnets production and corresponding commercial scale magnet recycling capacity. Nearly all production stages are concentrated in China. Furthermore, processing rare earth elements in a sustainable manner requires proactive environmental risk mitigation controls, which not all countries and companies in the market are willing to invest in. Substitution is also difficult throughout the supply chain due to the unique characteristics and technical advantages of rare earth magnets. Rare Earth Supply Chain Challenges 6. The Secure Supply Chain Working Group membership identified the following shared insights: a. geographical concentration of key stages of the supply chain: China accounted for nearly 60 percent of total rare earth mining production in 2020, an estimated 89 percent of total rare earth separation capacity, an estimated 90 percent of total metal refining Annex III – Secure Supply Chains 15 / 48 capacity, and approximately 92 percent of global sintered Neodymium-iron-boron (“NdFeB”) magnet manufacturing; b. insufficient suppliers and domestic capacity in the United States and EU throughout the supply chain; c. projected, rapid demand growth rate to meet net-zero emissions targets; d. extreme market volatility; e. limited substitutability of alternative materials and limitations to cost-efficient recycling; and f. need for high environmental, social, and governance standards across the supply chain. Transatlantic Actions on Neodymium Magnet Supply Chains 7. The U.S. Government is marshalling substantial resources to address these vulnerabilities and provide incentives for domestic production of rare earth magnets, including through resources provided under the Infrastructure Investment and Jobs Act of 2021. It is providing funding to establish a rare earth demonstration facility to demonstrate the commercial feasibility of new technologies for a full-scale rare earth extraction, separation, and refining; to advance critical material innovation, efficiency, and alternatives; and to establish a Critical Minerals Supply Chain Research Facility. The United States has also awarded funding to establish domestic commercial scale processing and separation capabilities for rare earth elements. 8. The EU, through the Horizon Europe research and innovation programme, provides funding for mining, processing, separation and refining of rare earths and recycling of neodymium magnets. The European Raw Materials Alliance plans to develop a pipeline of investment projects along the rare earths and neodymium magnets value chain. The Alliance has come forward with 14 projects which could meet 20 percent of EU demand in rare earth magnets by 2030, compared to only a few percent today. The Clean Technology Materials Task Force brings together the European Investment Bank and the European Bank for Reconstruction and Development to accelerate investment in critical raw material projects in the investment pipelines. 9. We support private sector investments in the industry and actions to provide certainty of demand for diverse producers of neodymium magnets through, for example, definitive supply or offtake agreements between Original Equipment Manufacturers and producers. 10. We resolve to preserve the openness of the transatlantic supply chains. Both sides intend to take utmost care to avoid unnecessary barriers to trade barriers, which could negatively affect the other side’s production and trade opportunities in this supply chain. Future Collaboration 11. To further enhance collaboration and coordinate policy actions, we are committed to redoubling and refocusing efforts through the TTC and other relevant multilateral initiatives, particularly partnerships to increase responsible investment for near-term rare earth elements project opportunities and the Conference on Critical Materials and Minerals between the European Union, the United States, Japan, Australia and Canada, to continue Annex III – Secure Supply Chains 16 / 48 to address rare earth elements supply chain vulnerabilities and to promote undistorted trade throughout the rare earth supply chain. 12. These enhanced efforts are focused on deeper research and development collaboration to unlock and maximize transatlantic mining production and processing capacity; improve characterization and utilization of unconventional resource extraction and processing (e.g. sourcing rare earths from by products and recycling streams); foster novel and effective recycling processes; support the development and adoption of standards for rare earth magnets and sustainable mining practices; and coordinate domestic initiatives that support trade and investments in the rare earth magnets supply chain. We intend to prioritize and advance projects of common strategic interest, leveraging respective diplomatic, project development, financing, and private industry resources ."
(20min delay)
