Solvay to supply Europe with rare earth metals to reduce reliance on China

The Belgian chemicals group Solvay said it plans to supply Europe with rare earth metals used in permanent magnets for electric vehicles and wind turbines from its refurbished plant in France to help the continent reduce its reliance on China.

The group confirmed that the La Rochelle plant will start regular production in early 2025 and said it aims to meet 30% of Europe's permanent magnet needs by 2030. This is the only facility in Europe capable of industrially processing light and heavy rare earth materials.

Solvay Group CEO Philippe Kehren told Reuters in a conference call that Solvay supports Europe's strategic shift to start producing permanent magnets instead of importing them from China, adding that demand in Europe is expected to triple by 2035. "Our goal is to supply the whole of Europe with rare earth metals produced in La Rochelle."

Solvay confirmed that it was in discussions with major European carmakers and turbine manufacturers to gain support from the entire value chain. Callen said the company is also in advanced discussions with the French government about seeking support, but he did not provide further details.

Under a new EU law that came into effect in May, the bloc aims to ensure self-sufficiency in key materials, which are currently mainly supplied by China. The EU has set a goal of mining 10% of its key mineral needs each year, recycling 25% and processing 40% domestically by the end of the century.

The EU also said that no more than 65% of the total rare earth supply should be provided by one country. Currently, China is estimated to supply about 95% of the EU's rare earth needs.

Callen said Solvay should benefit from this move. The company said it plans to source 30% of the raw materials for its La Rochelle plant by recycling scrap rare earth metals from engines in Europe, rather than shipping them back to China.