ferrite magnets
Carbon neutrality reshapes demand for rare earths
Sep 15,2021.

Rare earths: industrial vitamins, new materials and other downstream fields are widely used. Rare earths are the general name of 17 chemical elements, known as "vitamins of modern industry", and can be divided into light rare earths and heavy rare earths. The rare earth industry chain is mainly composed of upstream mining, midstream material preparation and downstream applications. Rare earths are widely used in metallurgy, military, petrochemical, glass ceramics, agriculture, new materials and other fields. Rare earth permanent magnet materials account for 42% of my country's rare earth consumption and are the most important track downstream of the rare earth industry chain. Rare earth permanent magnets are currently the most comprehensive permanent magnets. NdFeB has the advantages of strong magnetism, resistance to magnetic loss, and temperature stability. It is the most widely used rare earth magnet. High-performance NdFeB permanent magnets are used in energy-saving products such as wind power and new energy vehicles. Other NdFeB permanent magnets are mainly used in magnetic separators and electroacoustic applications.

permanent rare earth magnets

China has the most abundant rare earth resources, and it is difficult to provide more supply increments at home and abroad in the short term. China is the country with the richest rare earth resources in the world. The rare earth reserves are 44 million tons REO, accounting for 37% of the global reserves. The Bayan Obo mine reserves are as high as 35 million tons. The world's largest rare earth mine. In 2020, the global output of rare earth concentrates will reach 240,000 tons, and China's output will be 140,000 tons, accounting for 58%. It is the main supplier of rare earth concentrates.


In the short term, it is difficult to provide more rare earth supply increments both at home and abroad. The domestic policy side "indicator control + industry integration" regulates rare earth production, and the increase mainly comes from the upward adjustment of indicators. The domestic rare earth output is controlled by the total index. In 2020, the mining index will be 140,000 tons and the smelting separation index will be 135,000 tons. The adjustment of aggregate indicators is related to the supply and demand side of the market, and demand growth may drive a certain increase in aggregate indicators. The increase in foreign production capacity is facing a bottleneck, and the project under construction is too early to start production. The main production capacity of foreign rare earth mines are concentrated in Mount Pass, Australia, and rare earth mines in Myanmar; Mountain Pass has a production capacity of 40,000 tons per year, which basically reaches the upper limit; Linus has a production capacity of 25,000 tons per year, and has a production capacity of 25,000 tons per year. Utilization rate is about 75%; Myanmar rare earth mines are an important source of domestic heavy rare earths. In 2020, the import volume will be about 20,000 tons. High-quality mines have sharply reduced due to political factors, and the production cycle has peaked: new foreign projects are mostly in the early stage, and it is difficult to provide growth in the short term. quantity.


Increased consumption of high-performance NdFeB opens up the growth space of the rare earth permanent magnet industry. Rare earth permanent magnets are the most important downstream applications of rare earths. China's rare earth permanent magnet production accounts for 90% of the world's total. The dual-carbon economy boosts high-performance NdFeB as the main product that will open up the market in the future. The three types of demand for new energy vehicles, wind power, and inverter air conditioners account for 48.8% of the consumption of high-performance NdFeB, which is expected to account for 59.6 in 2025. %. With the superposition of favorable factors such as market demand, raw material supply, policies and regulations, China's rare earth permanent magnet market is expected to be fully opened up.


Low-carbon demand is fully opened, creating a new industry growth curve. New energy vehicles are the biggest driving force. The growth of wind power generation has remained stable under the drive of carbon neutrality. The penetration rate of inverter air conditioners and energy-saving elevators has increased. In addition to energy conservation and environmental protection, traditional automobiles, industrial robots, consumer electronics, and mechanical hard drives There are also many applications of neodymium iron boron in fields such as, servo motors.


NdFeB magnets are in short supply, and the demand pattern for rare earths is reshaping. The demand for new energy is fully exploded. In 2025, the global demand for high-performance NdFeB is expected to reach 196,800 tons, with a CAGR of 18.57%. In 2020, the supply of praseodymium and neodymium oxide is 66,600 tons, the demand is 67,200 tons, and the supply gap is 542 tons; it is expected that the supply gap will gradually expand from 2021 to 2025, reaching 379/1195/3227/7335/12936 tons, respectively.


Supply and demand reconstruction, this round of market is expected to last longer


The rare earth market has been dominated by short-term policy disturbances in supply, while the current market is dominated by demand and lasted for a long time. The rare earth industry has gone out of four waves in the past ten years, but the fluctuations are relatively large and the duration is relatively short. The longest wave of market is less than a year, and the market is basically driven by supply. Since May 2020, rare earths have gone out of a new market. The difference is that this market lasts for a long time, and the market has lasted for more than a year, and the current dominant force in the rare earth industry has undergone a fundamental change. The dominant situation has been reversed, and the substantial increase in demand for new energy has become the main logic: supply-side policies have been exerted in various aspects, the supply order has been rectified, and the elasticity of supply has decreased; the demand for new energy and energy conservation and carbon reduction demand has surged, and rare earths have begun to be dominated by demand .

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