# Rare Earth Magnet Recycling and Materialization for a Circular Economy--A Korean Perspective
## 2 Material Flow of REEs in Korea  
REEs are essential components for production in high-tech manufacturing, such as in transportation, optics, defense, renewable energy, and agriculture applications, due to their exotic physical and chemical properties. Figure 1a shows the global demand for REEs by application, showing that the compound annual growth rate (CAGR) of demand for REEs is increasing at 8.9%. Among them, the demand for REE magnets is the highest, reaching a volume of 66.65 kt in 2019. Similarly, Figure 1b shows the demand for REEs in the Republicof Korea in the form of metal (RE metals), compounds (REE oxides and REE compounds), and products (RE magnets or products) from 2015 to 2019. The demand reached as high as 7.7 kt in 2019, up from 4.0 kt in 2015. Because most REE magnets are imported in finished or semi-manufactured form, it can be observed that the overall amount of REE products has increased due to the development of the magnet industry. The increased demand for REE magnets from 2015 onwards can be largely linked to the growth of the automobile sector in Korea. Kia and Hyundai are two of the major world players in the automotive sector, who are set to make a mark in the transformation to eco-friendly vehicles. RE elements are applied to various parts in eco-friendly automobiles, including hybrid electrical vehicles (HEVs) and battery electrical vehicles (BEVs), which use about 1 and 2 kg of Nd per vehicle, respectively [25]. Figure 2 show the domestic sales of eco-friendly vehicle from 2015 to 2019. Around 80 ton of rare earth elements were used in the manufacturing of the two types of vehicles in 2019. BEV sales are steeply increasing, while the HEV market is gradually becoming saturated because the transition from the traditional engines to electronic motors has been accelerated by environmental policy. Even if the sales of BEVs decrease, it can be expected that the number of REE magnets used will steadily increase due to sales of BEVs. The role of REE magnets in the development of the industrial economy of the Republic of Korea is indispensable. Figure 3 shows the total weight and price for REEs supplied to Korea from 2005 to 2018. In terms of price, it can be seen that the market never fully recovered from the price hike that resulted due to Chinese export restrictions in 2010 and 2011, which created an REE supply deficit. Although the global production rate has increased since 2013  
Figure 1: Compiled demand trends for rare earth elements: (**a**) world market demand trends by application [23]; (**b**) Korea demand trends for metals, compounds, and products [24]. Figure 2: Compiled trends for the numbers of Korean-manufactured eco-friendly vehicles sold and REE magnets used [26]. due to China's removal of export quotas, along with increased mining outside of China, the expected shortfall of certain REEs, including Nd and Dy, resulted in bullish market behavior [26]. REE prices have seen an increasing trend since 2015, which is expected to continue. Moreover, the share of the Korean REE supply from China was as high as 89% in 2005, which decreased to 78% in 2018. This shows that the supply of REE resources in Korea is sensitive to the influence of REE restrictions in China; therefore, instability in the REE supply in Korea can be caused by China, as mentioned above. In addition, these figures pose an imminent threat to Korea, given the political stance Korea has in the trade negotiations between the US and China. In order to deal with an unstable supply chain, a critical resource management analysis was conducted for the material flow of 63 materials in Korea, including REEs. Figure 4a,b show the qualitative results of the materials flow analysis for Nd and Dy in 2016, respectively [28].