What do animals use it for?
Animals use this ability to locate their home if they were lost, to enable orientation or navigation.
Magnetoreception operates differently depending on the animal. For example "birds gain a compass by sensing the field lines (over the earth) and their inclination". Other animals such as sea turtles literally map their environment using the various levels of magnetism in the rocks around them.
One of the main issues that scientists encouner when trying to identify if a species has magnetoreception, has to do with locating the sensory receptor. Since neural activity has to be monitored and the receptor can be as small as 1mm cube in size, it can be extremely difficult to locate the part of the brain that processes it.
even though its been studied for 40 years magnetoreception still remains a mystery and recent reaserch on humans might be very promising.