Aerospace suppliers test rare-earth alternatives to ease reliance on China

By Allison Lampert and Karen Freifeld

Sept 21 (Reuters) - Rare earth shortages are pushing some suppliers of aerospace companies to revisit decades-old turbine coating formulas once considered obsolete, after US-China tensions disrupted supplies from the world's dominant producer of critical minerals.

China has a near monopoly on rare earths and materials such as yttrium, indium phosphide and tungsten, which are used in a range of aerospace and defense systems, including jet engine coatings, turbine components and semiconductor chips.

Despite early efforts, producers of coatings for aerospace remain years away from replacing modern rare-earth-based materials, or finding adequate supply of rare earths in the United States, experts say. The renewed interest in decades-old alternatives reflects concerns that supply disruptions and high prices could threaten key parts of the jet-engine supply chain.

The National Research Council of Canada (NRC), the country's primary agency for scientific and industrial research and development, said rare earth shortages were behind industry interest in finding alternatives for the thermal barrier coatings used in the hottest sections of jet engines.

The NRC and several industry partners are evaluating whether zirconium dioxide and other non rare earth ceramic oxides dating back to the 1970s and 1980s can be comparable with modern rare-earth-based coatings.

"Now 50 years later, perhaps with the better instruments and engineering that we have, we can try to improve those materials," said Rogerio Lima, a senior research officer at the NRC.

RELIANCE ON CHINA WON'T END SOON

European thermal coatings producer Oerlikon Metco OERL.S said it already sells some rare-earth-free products and has more in development, including zirconia-based thermal barrier coatings made with magnesium and calcium oxides that predate today's rare-earth-enhanced materials.

Some US thermal-coating suppliers are also exploring non-rare-earth alternatives for less critical components, one industry source said.

Recycling surplus coating materials could also help ease supply constraints, a separate industry source said.

Still, such efforts can only alleviate, not solve, aerospace's reliance on China.

"Even under optimistic scenarios, we are years, not months, away from breaking our dependency on China for rare earths," said Geoffrey Gertz, a former official on the White House National Security Council and senior fellow at the Center for a New American Security.

"And that means China will continue to have considerable leverage in trade negotiations with the United States."