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Philips Lighting, GBU Fluorescent 2011 Price increases due to phosphor increases
Philips Lighting, GBU Fluorescent2011
Price increases due to phosphor increases
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011 2
What is Rare Earth? How is related to the lighting industry?
Resources: DOI, US, Geological Survey, Circular 930-N; USA Congressional Research Service, Sep 2010, Wikipedia
There are 17 rare earth elements (REEs). They have names like lanthanum, europium and yttrium. And they're critical to a variety of high-tech products and manufacturing processes, including catalytic converters, petroleum refining, color TV and flat panel displays, permanent magnets, batteries for hybrid and electric vehicles, medical devices, and phosphor powders used in fluorescent lamps.
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011 3
The issue of raising costs: demand of Rare Earth is rapidly increasing while supply is controlled by China
According to Goldman Sachs:
"We envisage that the market for rare earths will remain in severe deficit in 2011 and 2012, and that prices will trend higher over the next 18 months.“
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011
Rare Earth (REO) price determines Phosphor costGlobal Rare Earth raw material price is fully transparent -> www.asianmetal.com
Yttrium (Y)Europium (Eu)
Cerium (Ce)Lanthanum (La)
Terbium (Tb)Gadolinium (Gd)
Europium (Eu)REO material 78% of costprice
REO material100% of cost price
REO material 3% of costprice
Avg impact REO costprice is 70%!
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011
China dominates world supply market
Source: US Geological Survey
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011 6
Rare Earth Price Trend in the past 3 years indicates massive increase since 2011
Confidential Philips Lighting, GBU Fluorescent, Irene Klein, Gerbrand Swart, 2011 7
The increase accelerates in 2011
• On top of phosphor, cost increase come from labor cost (20% up), components (average 30%) and plastics (average 30%).
Source: www.metal-pages.com
Yttrium Terbium
Cerium Europium
