Recently, China North Rare Earth Group seeked to obtain a patent for its innovative rare earth ore slurried decomposition process in China, US, Japan and the EU through the Patent Cooperation Treaty pathway. Studies have shown that the consumption of chemical raw materials and energy while applying a patented process has dropped significantly and the rate of resource extraction has increased.
New patents related to rare earth processing are indeed rare. The largest consumers of neodymium iron boron rare earth permanent magnet materials in China are Japanese and American companies. It comes from the fact that even if China rare earth output is large, domestic companies are often lacking the technology to process those rare earths into more added value products.
We interviewed a number of Chinese industry sources on the issue of rare earth patents. One source, wishing to remain anonymous said that “Chinese enterprises have suffered. As the country with the most abundant rare earth reserves in the world, my country’s rare earth industry once tried to embark on a development path of “resources for technology”. However, multinational rare earth giants strictly restrict the opening of technology to China, and at the same time, they have conducted large-scale patent cross-licensing with each other, forming a community of interests with a strict patent protection network.”
In the 1980s, Japanese strategy of creating patent clusters in the rare earth industry was already very mature. Not only did the Japanese write the implemented technology into patents, they also patented some technologies that were not implemented at the time. In order to expand, certain Chinese companies have purchased patent licenses from Japan. In addition to the expensive licensing fees, Chinese companies also needed to pay a percentage of their profits to licensors based on their export value. In this way Japanese companies benefited from the development of Chinese rare earth industry.
In recent years, China’s rare earth magnetic materials research and development has made some breakthroughs, for instance in R&D of novel neodymium iron boron sintering methods. The application range of NdFeB and SmCo magnets has been continuously expanded. China has mastered the key core technologies for the industrialization of anisotropic SmFeN magnetic powder, and the research on nano-composite rare earth permanent magnet materials has reached the international level.
At the same time, China has begun to establish a relatively complete industrial system for the preparation and application of rare earth permanent magnet materials, becoming the world’s largest production base of rare earth permanent magnet materials, with an output exceeding 85% of the world, breaking through the market monopoly of developed countries. It has made a leap from a rare earth resource country to a rare earth permanent magnet materials producing country.
Future lies in owning independent intellectual property rights in the rare earth industry. China needs to focus on further development of the rare earth processing industry. It needs to formulate a national intellectual property strategy for the rare earth industry, support relevant companies in expansion on international markets, and in filing international patent applications.
China’s industry insiders already talk behind closed doors about bringing together relevant domestic enterprises and scientific research institutions and establishing a rare earth technology patent alliance. If necessary, cutting edge foreign core patents can be further acquired to raise the level of rare earth technology in domestic industry and stimulate further independent research.