Molycorp also manufactures a range of zirconium based engineered products. Zirconium can either be produced as a single element or combined with rare earths such as cerium and yttrium. The primary applications for the division’s zirconium products are automotive catalytic converters, glass, ceramics and electronics.
Our ability to leverage our existing customer base greatly enhances the growth prospects for our zirconium business: many rare earth customers are potential zirconium customers.
Automotive Catalytic Converter
As indicated earlier, zirconium is important in the manufacture of automotive catalytic converters. Zirconium oxide and zirconium reactive chemicals are used as individual components as well as inter-combined with rare earths (primarily cerium as well as other multi-rare earth formulations) automotive catalytic converters.
Both zirconium and rare earths provide catalytic functionality, but newer mixed rare earth and zirconium oxides provide increased performance coupled with higher temperature stability and lower platinum group metals requirements, key features for the newer generations of automotive catalytic converters.
The largest markets for automotive catalytic converters are North America, Europe, and Japan, but demand in the rest of the world is expected to increase due to expanding environmental regulation. The factors driving increasing demand for rare earth and zirconium for the automotive catalytic converter market include:
- Legislation in New Markets and Applications: A variety of new markets requiring emission control catalysts are continuing to emerge. For example, India, Argentina, and certain countries in Asia and parts of Eastern Europe are beginning to introduce environmental legislation which is expected to increase demand for automotive catalytic converters. In addition, applications in diesel emission control continue to demand new rare earth/zirconium formulations.
- Refinement of Current Environmental Legislation: Developed nations are continuing to adopt even more stringent automotive exhaust emission standards such as the Federal U.S. LEV (Low Emissions Vehicle), California ULEV (Ultra Low Emissions Vehicle), and the EURO III and EURO IV standards. These more stringent standards continue to demand advanced catalyst formulations which, in turn, demand advanced rare earth and zirconium based materials technology.
- Cost Reduction: Automotive catalytic converter producers have been under considerable pricing pressure, exacerbated by industry over-capacity and their willingness to secure market share by lowering prices and making other costly concessions to the auto companies. Furthermore, the major auto companies have implemented significant catalyst cost reductior programs. In combination, these changes have driven the development of new catalyst technologies that lower the use of platinum group metals (the most costly automotive catalytic converter component). Automotive catalytic converter formulations containing advanced rare earth and zirconium have played and will continue to play an important role in permitting reductions in the use of precious metals going forward.
In addition to automotive catalytic converters, zirconium oxides are used in automotive oxygen sensors, which are part of the engine management and exhaust catalyst control systems; multi-layer ceramic capacitors and other dielectric chips which store electrical energy and release it on a controlled basis; glass and fiber optics; and structural ceramics which have become increasingly important in the hardened material manufacturing sector where light weight and structural strength is necessary.
As well, yttrium-stabilized zirconium oxides are used in thermal barriers for power generation industrial gas and aviation turbines, providing a protective layer for the turbine alloy against high temperatures and wear. In addition, Molycorp supplies zirconium oxide powder to manufacturers of paints and pigments and solid-oxide fuel cells used in stationary power generation and cogeneration fuel cells.