Price trend:

According to SunSirs' commodity market analysis system, domestic heavy rare earth prices declined significantly in December. The prices of dysprosium oxide, dysprosium-iron alloy, and metal dysprosium continued to fall. As of December 26th, the price of dysprosium oxide was 1.345 million RMB/ton, a decrease of 9.43%; the price of dysprosium-iron alloy was 1.32 million RMB/ton, a decrease of 9.59%; and the price of metal dysprosium was 1.91 million RMB/ton, a decrease of 7.95%.

In December, the market price of heavy rare earth elements experienced a significant decline. Due to weak end-user demand, market activity gradually cooled down, and trading remained cautious. The metal market was relatively calm, with some metal traders proactively lowering prices to attract buyers. Separation plants in Jiangxi and Guangxi provinces maintained low operating rates, resulting in little change in heavy rare earth production. Coupled with the lack of active purchasing from some magnetic material companies, the price of heavy rare earth elements fell sharply.

1. Demand side: Essential demand was shrinking at the end of the year + resistance to high prices, leading to a slowdown in purchasing pace

Cash flow pressure at the end of the year: Downstream magnetic materials, wind power, and new energy vehicle companies were entering year-end settlement, the cash flow for small and medium-sized enterprises was tight. They were reducing raw material inventories and only maintaining sporadic purchases for immediate needs, with bulk orders delayed until the first quarter of 2026.

High prices were suppressing purchasing intentions: The prices of terbium oxide and dysprosium oxide were at high levels in the previous period (terbium oxide once reached nearly 7 million RMB/ton), leading to significant resistance from downstream buyers to the high-priced raw materials.  The "buy on the rise, not on the fall" sentiment spread, creating a strong wait-and-see atmosphere, and reduced transaction volumes exacerbated the downward price trend.

Seasonal demand was weakening: the peak season for wind power installations was ending, and the growth rate of new energy vehicle production and sales was slowing down, reducing the incremental demand for heavy rare earth elements such as dysprosium and terbium. The demand side lacked strong support.

The front-loading effect of exports was fading: In November, overseas orders boosted exports by 24.4% year-on-year, but in December, overseas orders declined temporarily, weakening the support that export demand provided to prices.

2. Supply side: Short-term supply elasticity was being released, leading to a temporary easing of inventory levels

Myanmar's concentrated shipments before the mining ban: Before the comprehensive mining ban policy in Myanmar takes effect at the end of the year, there was a concentrated customs clearance of Myanmar's ion-adsorption type rare earth minerals (a core raw material for heavy rare earth elements) in early December. This improved the raw material supply for domestic separation plants and led to a temporary increase in spot supply.

Domestic Quotas and Maintenance-Related Shipments: The total mining quota for 2025 was 145,000 tons (a 5% increase year-on-year). Towards the end of the year, some separation plants accelerated shipments to meet their annual targets, coupled with inventory clearing before maintenance at some companies, leading to a short-term increase in the availability of spot goods.

Recycling of waste materials provided supplementary supply: When prices of heavy rare earth elements were high, the amount of recycled waste materials increased, which alleviated short-term supply shortages to some extent and puts downward pressure on spot prices.

Market Outlook

In the long term, the supply-side constraints on heavy rare earths (Myanmar's mining ban and strict domestic quota controls) remain unchanged, while the demand-side growth drivers (humanoid robots, wind power, and new energy vehicles) are firmly established. It is expected that prices will gradually stabilize and recover in the first quarter of 2026 as demand picks up and inventories are depleted.

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