SunSirs: Supported by Favorable Factors, the Light Rare Earth Market Soared

Price trend

According to the SunSirs commodity market analysis system, domestic light rare earth prices were trending upward. On August 18th, the SunSirs rare earth index was 525 points, up 18 points from the previous day, down 47.86% from its cyclical high of 1,007 points (February 24, 2022), and up 93.73% from its cyclical low of 271 points on September 13, 2015. (Note: The cyclical period refers to the period from December 1, 2011 to the present.)

Domestic prices of neodymium oxide, neodymium metal, praseodymium oxide, praseodymium metal, praseodymium-neodymium alloy and praseodymium-neodymium oxide have all risen sharply. As of the 19th, the price of neodymium oxide was 650,000 RMB/ton, an increase of 18.18% since August; the price of neodymium metal was 777,500 RMB/ton, an increase of 17.80%; the price of praseodymium oxide was 642,500 RMB/ton, an increase of 18.43%; the price of praseodymium metal was 765,000 RMB/ton, and the price trend increased by 14.18%; the price of praseodymium-neodymium alloy was 762,500 RMB/ton, an increase of 15.97%; the price of praseodymium-neodymium oxide was 625,000 RMB/ton, an increase of 20.19%.

Analysis review

In August, domestic light rare earth prices rose sharply, and supply in the market remained tight. Macroeconomic news suggests the supply and demand structure of praseodymium and neodymium products may tighten further, exacerbating market expectations of shortages and driving up prices. The booming downstream industries, such as new energy vehicles and home appliances, drove a significant increase in orders for downstream magnetic material manufacturers in the fourth quarter. Combined with ample orders from magnetic material manufacturers, this boosted domestic demand for light rare earths, leading to an upward trend in the light rare earth market.

After years of governance, the domestic rare earth industry has gradually formed a supply structure with large groups as the main body and relatively concentrated raw materials. With the continuous development of the foreign rare earth industry, China's share of rare earth production has dropped from 90% to 70%, which has brought certain benefits to the domestic rare earth market.

Market outlook

Recently, magnetic material companies have been positive in their ordering and purchasing sentiment, the supply and demand game in the light rare earth market has continued, and an imbalance in the supply and demand of praseodymium-neodymium series products has emerged; in addition, in the long run, the long-term growth trend of terminal demand such as industrial robots, new energy vehicles, and wind turbines remains unchanged, and the penetration rate of high-performance neodymium iron boron permanent magnets in terminals is expected to continue to increase, and the light rare earth market trend will rise in the short term.

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