Circular moves for compressor magnets

Rare earths are critical for applications including magnets in EVs, wind power generators and compressors in refrigeration equipment. According to the International Energy Agency, demand is accelerating rapidly, while supply of new rare earth resources is not keeping pace.

Manufacturers in Japan are addressing the scarcity challenge through establishing what is being hailed as Japan’s first domestic circular scheme for commercial air conditioning compressor magnets.

Led by Daikin, the collaboration with Shin-Etsu Chemical, Hitachi and Tokyo Eco Recycle will recover and recycle rare earth magnets reclaimed during the course of repair and upgrade works from compressors in Daikin commercial air conditioners.

Daikin will manage the reclamation process, and the Hitachi-owned enterprise, Tokyo Eco Recycle, will undertake the physical process of dismantling, demagnetisation and extraction of the rare earth magnets. Hitachi is also contributing recycling expertise from pre-existing efforts with residential air conditioners.

Shin-Etsu Chemical is an established rare earth magnet recycler and manufacturer. It will utilise the recovered rare earth materials to produce new magnets. Robotics will be incorporated into the plant to automate operations.

Instead of the conventional use of electric arc furnaces for demagnetisation, Shin-Etsu Chemical has developed an approach using resonant damping demagnetisation which involves applying an alternative magnetic field of gradually decreasing amplitude. This is a process that does not generate CO₂, further contributing to the environmental credentials of the circular economy initiative.

The government of Japan has recognised the risks inherent in a constrained global supply chain for rare earth minerals. According to Nikkei Asia, it plans to offer subsidies in fiscal year 2026 for recycling infrastructure, including equipment for transport storage and testing.

The consortium aims to launch the facility in 2026 and scale operations in 2027, with the goal of achieving recovery of several metric tonnes worth of neodymium-based magnets from commercial HVAC equipment annually.

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