SunSirs: Negative Factors Make Domestic Rare Earth Prices Continue to Decrease

Recently, domestic rare earth market has been falling continuously. Influenced by domestic policies and the reopening of Myanmar gateways, the trend of domestic rare earth has declined sharply.On Nov 5, the rare earth Commodity Index was 339, the same as that of Nov 4, 66.10% lower than the peak of 1,000 in the cycle (Dec 6, 2011), and 25.09% higher than the lowest point of 271 (Sep 13, 2015). (Cycle: Dec 1, 2011 to date)

Nov 6, Rare-Earth Metal: the average price of Neodymium Metal was 363,500RMB/t, the average price of Dysprosium Metal was 2,005,000RMB/t, the average price of Praseodymium Metal was 660,000RMB/t. Rare-Earth Oxide: the average price of Praseodymium-Neodymium Oxide waso 287,500RMB/t, the average price of Dysprosium Oxide was 1,515,000RMB/t, the average price of Praseodymium Oxide was 35,5000MB/t, the average price of Neodymium Oxide was 289,500RMB/t. Rare-Earth Alloy: the average price of Praseodymium-Neodymium Alloy was 363,500RMB/t, the average price of Dysprosium Ferroalloy Alloy was 1,515,000RMB/t.

Recently, the price trend of dysprosium and terbium series has declined significantly. Myanmar has opened gateways, the supply pattern of domestic heavy rare earth market has changed, and the domestic supply has increased. In addition, the recent domestic demand is limited, the domestic prices have dropped sharply. The domestic policy is still in fermentation, which brings some good expectations for the domestic heavy rare earth market.

The price fluctuation is related to the national environmental protection supervision. Rare earth’s production has particularity, especially the radiation hazard of some products, which makes environmental protection supervision more stringent. Metal enterprises and downstream magnetic material enterprises are less interested in purchasing due to the surplus of purchasing before the festival, and the prices of rare earth have been lower than that in the earlier stage, so the wait-and-see mood is strong. Under the strict environmental protection inspection, the production of rare earth separation enterprises in many provinces has been stopped, resulting in the general market supply of rare earth oxides, especially some mainstream rare earth oxides, the supply is normal, and the market price trend is declining. Recently, large enterprise groups have been reluctant to sell, rare earth market has been general, and trading volume has had little change.

The National Environmental Protection Department has not reduced its stringent efforts, which has a great impact on the Rare Earth industry, the operating rate has been low, the market has been cold, and there has been regulations of Rare-Earth industry in Jiangxi, a large province of Rare-Earth producing, all of which are good news to the Market. Recently, the Supervisory Group of the State Council has gone to Jiangxi Rare Earth enterprises. This inspection closely centered on the major deployment of the Central Committee of the Communist of China and the State Council, highlighted the key and difficult issues in the field of economic operation and reform and development, and focused on the strong blockades and pain points reflected by the people and the market subjects, so as to promote the implementation of various tasks from point to area. Besides, the NDRC and departments concerned have promoted effective measures urgently，strengthen the consolidation and made the related management mechanisms innovate and improved, in order to accelerate the construction of a development pattern which consists of a rational industrial structure, an advanced scientific and technological level, the effective resources protection and the orderly production and operation and to add the special value of Rare Earth as a strategic resource. The supply of raw ore resources in the upstream of the Rare Earth industry has shrunk, and people in the domestic market are waiting for the good news on policies and State Reserve.

Rare Earth analyst from SunSirs expects that some prices of Rare Earth may continue to decrease. Although the supply may stay at low as well, caused by the strict environmental protection inspection and the regulation of the industry, the downstream demand is still not good and the import of heavy rare earth has increased.

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