SunSirs: Surge in Demand from Emerging Sectors Drives Rare Earth Prices Higher

Rare Earth Prices Continue to Climb

Since the start of the year, rare earth prices have been on an upward trajectory. Data shows that as of February 9, the SunSirs Rare Earth Index stood at 703 points, up 179 points or 34.16% from early December.

Looking at specific products, data from the Baotou Rare Earth Exchange shows that as of February 11, the average price of praseodymium-neodymium oxide reached RMB877,000  per ton, up over RMB260,000 per ton since the start of the year, a 43.42% increase. The average price of neodymium oxide reached RMB870,000 per ton, up RMBb260,000 per ton since the start of the year, a 42.62% increase. The cumulative price increases for praseodymium-neodymium oxide, neodymium metal, and praseodymium-neodymium metal have all exceeded 35% this year.

This round of rare earth price increases has been driven by multiple factors, including tightening supply, surging demand, and low inventory levels. On the supply side, China holds the world's largest rare earth production and reserves, yet the growth rate of China's total rare earth mining quotas has slowed significantly in recent years. Overseas, instability in Myanmar has led to continued tightening of rare earth exports, while Vietnam has amended its laws to ban the export of rare earth ore. These factors collectively exacerbate the global supply crunch in the rare earth market.

Additionally, China has continuously introduced policies to promote standardized development in the rare earth industry. In October 2024, the “Rare Earth Management Regulations” officially took effect; in August 2025, the “Interim Measures for the Total Quota Control of Rare Earth Mining and Refining” were issued, reflecting the ongoing refinement of national policies for high-quality development in the rare earth sector.

According to data from the U.S. Geological Survey (USGS), global rare earth ore production reached 390,000 metric tons in 2024, with China accounting for 270,000 metric tons—69% of the global total. At the quota level, the annual rare earth mining quota for 2024 was set at 270,000 metric tons, representing a 5.9% year-on-year increase. However, this growth rate slowed by 15.5 percentage points compared to the previous year, maintaining a decelerating trend in quota expansion.

Explosive Demand in Emerging Sectors

From the demand side, rare earths—as non-renewable strategic resources—are experiencing sustained growth driven by emerging sectors like humanoid robotics and low-altitude economy.

For humanoid robots, joint motors require rapid response, high starting torque, and precise control. High-performance neodymium-iron-boron permanent magnets, with their superior magnetic properties and stability, have become the core material choice to meet these demands. The rare earth permanent magnet industry stands to benefit significantly from the mass production of robots.

In the low-altitude economy sector, electric vertical takeoff and landing (eVTOL) aircraft impose stringent demands on propulsion systems. High-performance neodymium-iron-boron permanent magnets are crucial for ensuring their motors achieve high power density, efficiency, and lightweight design. According to Adamas Intelligence data, a single eVTOL typically requires approximately 10kg to 20kg of neodymium-iron-boron magnets. The low-altitude economy industry is poised to become a new growth driver for rare earth demand.

Emerging sectors (humanoid robots and low-altitude economy) are projected to increase neodymium-iron-boron demand to 33,000 tons by 2035, accounting for 5.5% of total demand, with this share expected to rise to 7.6% by 2040.

As rare earth applications expand in high-end manufacturing, sustained growth in downstream demand from new energy vehicles, wind power generation, and robotics—coupled with technological advancements and government policies supporting resource management and industrial upgrading—positions the rare earth permanent magnet sector for a new growth cycle.

Concept Stocks Show Significant Profit Growth

Data indicates that among the 26 rare earth permanent magnet concept stocks listed on China's A-share market, 16 have released 2025 earnings forecasts or preliminary reports. Fifteen of these stocks have either turned losses into profits or forecast increased earnings, demonstrating a marked improvement in the sector's profitability.

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