Wednesday, July 27, 2011

Fluorescent tubes to increase in price due to rare earth material shortage

Rare earth metals are elements vital to our energy-efficient fluorescent lamps as they are a crucial componant of the light producing tri-phosphors inside the lamps.
According to www.sylvania.com/phosphors, currently 95% of the world's rare earth metal mining and oxide production comes from China where the manufacture and export of these products are controlled.

The Chinese government has implemented new tariffs and mining regulations on rare earth materials. These actions, coupled with increasingly strict export quotas, have caused the price of these compounds to substantially increase – as much as 3500% since January of 2010 in some cases.

Due to regulation, exports of rare earth materials were reduced 40% from 2009 to 2010 and another 35% during the first half of 2011 compared with prior year. It is clear that the China policies regarding rare earth materials must be addressed with multiple strategies in order to stabilize pricing and supply of these critical minerals.

All lamp manufacturer's distributing linear fluorescent tubes in the United States are forced to raise their price to their customers in order to offset their steep rising costs. Sylvania.com is reporting they will be reviewing and potentially raising their prices monthly until the global pricing is stablized.

Here is a link to a PowerPoint presentation on the rare earth material shortage http://assets.sylvania.com/assets/Documents/sylvania-presentation-rare-earth-crisis.0e64cc05-e1a4-4419-8f60-95ae0d35ae71.pdf

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