The shortage of rare-earth materials is becoming increasingly dire as already short supply chains were reduced this summer. Consequently, prices for rare-earth materials have increased dramatically, further impacting the optics and photonics industry, which depends on 15 of the 17 rare-earth elements and was already suffering from insufficient materials to meet demand.
For example, JENOPTIK Optical Systems, an SPIE corporate member with U.S. manufacturing facilities in Massachusetts, Florida, and Alabama, has seen a 16-fold increase in the price of a cerium oxide, a glass polishing compound that is crucial to its business. This has resulted in increased costs, decreased profit margins, and an ever-growing challenge to remain globally competitive.
"Long term, I believe that increasing glass costs will 'shrink' the glass map and force us to find new ways to achieve the performance required by our customers without using anomalous partial-dispersion glasses," said JENOPTIK President Jay Kumler, a member of the SPIE Board of Directors.
China currently mines 94% of the world's rare-earth elements, but that nation has imposed quotas to limit exports of the materials, leading to the supply shortage and increased costs.
As an example of how governments are attempting to address the crisis, the U.S. Congress recently included language related to rare earths in the FY 2012 National Defense Authorization bill (H.R. 1540) that passed the House Armed Services Committee in May but has not yet been approved by the Senate. The provision would require the Defense Logistics Agency Strategic Materials Center to begin developing a plan to maintain a domestic supply chain that is competitive and multi-sourced. This comes as the shortage has impacted key defense applications including precision optics.
Some countries, such as the United States, Canada, and Australia, have also started strategic efforts to reopen mines. Those efforts, however, are not expected to have a significant impact for three years.
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