SunSirs--China Commodity Data Group

Member ID: password: Join Now!
Commodity News

SunSirs: Burmese Political Turmoil, Heavy Rare Earth Prices Hit New Highs

February 03 2021 08:45:07     SunSirs (Linda)

The price of Chinese dysprosium continues to rise, and the market price hit a 5-year high. As of the 2nd, the price of dysprosium oxide was 2.31 million yuan/ton; the price of dysprosium ferroalloy was 2.29 million yuan/ton, the price of dysprosium metal was 2.775 million yuan/ton, and the domestic price of terbium It even reached a 10-year high. On the 2nd, the domestic price of terbium oxide was 8.825 million yuan/ton, and the price of metal terbium was 11.025 million yuan/ton.

The reasons for the sharp increase in the price of the domestic heavy rare earth market include several aspects. First, the political situation in Myanmar is turbulent, and the global supply of rare earths is relatively concentrated. Myanmar is one of the producing regions second only to China and the United States. The Myanmar side has a greater impact on the domestic heavy rare earth market products, and the import source has been greatly reduced. The contradiction between supply and demand in the domestic heavy rare earth market has led to a sharp increase in the price of heavy rare earths. The second domestic rare earth purchasing and storage plan is a big benefit to support domestic heavy rare earth prices. In the purchasing and storage plan, medium and heavy rare earths account for a large proportion of annual output, which is expected to have a greater impact on the supply, demand and price of medium and heavy rare earths. Third, the downstream demand has continued to rise in the near future, new energy applications have grown rapidly, and the demand for permanent magnets has increased significantly. This has brought the most favorable support to the heavy rare earth market. The price of direct products in the heavy rare earth market has continued to rise. Due to the tight supply in the terbium market, the supply and demand are imbalanced. The market price of terbium is even higher.

According to SunSirs monitoring, the price index of the domestic rare earth market has risen. According to the rare earth sector index of the business community, the rare earth index on February 1 was 473 points, which was the same as yesterday, and was down from the highest point in the cycle of 1,000 points (2011-12-06) 52.70%, an increase of 74.54% from the lowest point of 271 points on September 13, 2015. (Note: The period refers to 2011-12-01 till now).

China's rare earth index has started to rise from November 2020, and the rare earth index of the business community has increased by about 100 points in the past three months. The price trend of the domestic light rare earth market cannot be ignored. Domestic new energy vehicle sales have increased, and terminal industries such as wind power and electronic products have developed rapidly. As the epidemic slows down, downstream manufacturers’ capacity utilization rate continues, and demand is mainly for on-demand procurement. The demand for neodymium iron boron is still high. New energy vehicles and The boom in the consumer electronics industry has also boosted the price of rare earths. The data shows that the current global demand for high-performance NdFeB is mainly concentrated in the automotive sector (traditional cars are close to 40%, and new energy vehicles account for more than 12%). The rest are wind power, consumer electronics, inverter air conditioners, and energy-saving appliances. All are in the 8%-10% range. The downstream demand is rising, and the domestic light rare earth market prices continue to rise. Recently, the price of terbium in the domestic heavy rare earth market has reached a 10-year high, and prices in the direct market have continued to rise.

China’s policies are even more supportive to the rare earth industry. On January 15, 2021, the Ministry of Industry and Information Technology publicly solicited opinions on the “Regulations on the Management of Rare Earths (Draft for Comment)”, releasing signals for regulating the management of the rare earth industry in my country and promoting high-quality industrial development. There are 29 drafts for comments, clarifying the division of responsibilities for rare earth management, the approval system for rare earth mining, smelting and separation investment projects, and the total index management system, etc., and emphasizes strengthening the management of the entire industry chain of rare earths and strengthening supervision and management. With corresponding adjustments, the rare earth industry is developing in a high-quality direction, favorable policies support the development of the rare earth industry, and the domestic rare earth market prices have risen sharply.

As the downstream areas of new energy vehicles, wind power, and inverter air conditioners continue to increase in volume, demand for rare earths will continue to increase, which is expected to drive further growth in demand. The global rare earth supply gap is expected to continue to expand. China's rare earth demand remains high. China's rare earth supply remains high. Significantly nervous, the contradiction between supply and demand in the rare earth market is sharp, and SunSirs analysts predict that the rare earth market prices may continue to rise in the later period.

If you have any questions, please feel free to contact SunSirs with

Rubber & plastics
Non-ferrous metals
Building materials
Agricultural & sideline products