Rare earth prices rise as markets wait for new export law

Supply of light and heavy rare earths is tight in China, and institutions fear that a new round of peak prices is coming

Rare earth prices rise as markets wait for new export law
The town of Baotou in Inner Mongolia is the hub of rare earth production in China, which dominates the global trade in the 17 rare earth minerals partly because countries like the US lack processing plants. File photo by AFP.

(ATF) The spot supply of light and heavy rare earths is tight in China, and institutions are concerned that a new round of peak prices is coming.

According to Ruidao Metal Network and Baotou Rare Earth Exchange on November 9, the overall rare earth market continued to rise last week, and prices of mainstream light and heavy rare earth products maintained steady increases.

Market inquiries continued to be active, spot stocks were tight, and downstream operating rates rose slightly. Some businesses have began to be reluctant to sell again. The price of holmium oxide has risen in the latest listing price of the Heavy Rare Earth Group.

The 14th Five-Year Plan is also about to be released, and science and technology are of great importance. Rare earths, as a key industrial additive, may see new demand. And with the State Council’s release of the new energy vehicle industry development plan (2021-2035), rare earths are important for permanent magnet synchronous motors.

For raw materials, demand in this field is expected to maintain rapid growth. In the short term, market sentiment is positive, as the supply and demand pattern are improving, and prices are relatively strong.

Listed prices that Northern Rare Earth announced on the 9th showed that the price of neodymium praseodymium has increased significantly.

Neodymium praseodymium oxide was reported at 370,000 yuan a ton, up 13,000 yuan from October, while neodymium oxide was reported at 404,000 yuan a ton, up 28,000 yuan, and neodymium metal was reported at 461,000 yuan a ton, up 16,000 yuan from the previous month, then later reported at 502,000 yuan a ton, up 33,000 yuan from the previous month.

One of the rising big players is North Rare Earth (600111) and its main business is the sale of rare earth raw materials and rare earth functional materials. The company's main products are rare earth concentrates, rare earth carbonates, rare earth oxides, rare earth salts, rare earth magnetic materials, polishing materials, hydrogen storage materials, luminescent materials, nickel-hydrogen power batteries, and rare earth permanent magnetic resonance instruments. These are all vital materials in the high tech field.

Meanwhile, Securities Times reported that Jinli Permanent Magnet (300748) is going from strength to strength. The firm is a leading supplier of high-performance NdFeB permanent magnet materials in the field of energy-saving and environmental protection technologies. Its products are mainly high-performance NdFeB permanent magnet materials. At present, the company has supplied N52, 52M, 50H, 48SH, 48UH, 42EH, 40AH, 35VH and another series of high-performance NdFeB permanent magnet materials.

There has also been a surge in aluminium related prices, going up 5% on average.

According to market statistics from Baotou rare earth exchange, the cumulative increase of praseodymium and neodymium oxide exceeded 5% over the past month.

Analyst Baichuan Yingfu told jrj.com that downstream companies had insufficient inventory after the Chinese National Day, so they increased purchases and concentrated orders. 

In addition, the China's new Export Control Law, which will be implemented on December 1 this year, has caused concern about a decline in China's rare earth exports and has recently led to an increase in export orders.

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