ferrite magnets
Rare earth market steadily rises slightly
Sep 22,2021.

Price: The price of heavy rare earths keeps improving. According to data from the China Rare Earth Industry Association, among the major heavy rare earth products, the lowest price of dysprosium oxide was 2.645 million yuan/ton, a bi-weekly increase of 3.52%; among light rare earth oxides, praseodymium and neodymium oxide were the lowest The transaction price was 590,000 yuan/ton, a bi-weekly decline of 0.67%; the lowest transaction price of praseodymium oxide was 630,000 yuan/ton, a bi-weekly decline of 0.94%; the lowest transaction price of neodymium oxide was 614,000 yuan/ton, a bi-weekly decline of 0.82 %.

rare earth price market


Supply and demand: The operating rate, output, sales volume, and inventory of praseodymium and neodymium oxide producers fell month-on-month in July. According to data from the Asian Metal data center, the operating rate of Chinese praseodymium and neodymium oxide producers in July was 53.44%, a decrease of 12.08% month-on-month and an increase of 3.53% year-on-year; production was 2731 tons, a month-on-month decrease of 12.07% and a year-on-year increase of 6.89%; sales volume was 2866 Tons, a month-on-month decrease of 11.65% and a year-on-year increase of 23.80%; producer inventories were 6062 metric tons, a month-on-month decrease of 2.18% and a year-on-year increase of 26.03%. Divided by province, the operating rate of Inner Mongolia praseodymium and neodymium oxide producers fell to 60.63% month-on-month, production fell to 1003 tons, and sales fell to 1003 tons month-on-month; Sichuan praseodymium and neodymium oxide producers' operating rate fell to 37.86% month-on-month, and output fell to 325 Ton, sales fell to 355 tons month-on-month; sales from Jiangxi producers fell to 268 tons month-on-month.


Import and export: The import volume of rare earth ore increased in July, and the price fluctuated significantly. According to data from the General Administration of Customs, in July 2021, the import volume of mixed rare earth carbonate was 553.40 tons, a year-on-year decrease of 61.60%, and the average unit price was 12,100 yuan/ton, and the price fell 38.91% year-on-year; the import volume of rare earth metal ore was 9048.00 tons, an increase of 18.67 year-on-year. %, the average unit price was 26,100 yuan/ton, and the price increased by 121.49% year-on-year; the import volume of thorium ore and its concentrate was 1103.36 tons, up 108.47% year-on-year, and the average unit price was 27,300 yuan/ton, the price increased by 7.99% year-on-year; July total Imported rare earth ore was 10,704.76 tons, an increase of 11.57% year-on-year, and the average price was 25,500 yuan/ton, a month-on-year increase of 85.72%.


Investment logic: supply and demand and policies are expected to resonate, and rare earth prices may be stable while improving. In early September, the prices of light rare earths were operating steadily and the prices of heavy rare earths continued to rise. Due to the impact of the rainy season and the epidemic, the supply of rare earths in Myanmar has been disturbed. The peak season is approaching, superimposed on the expectations of the launch of relevant policies in the rare earth industry, supply and demand and policies are expected to resonate, and the price of rare earths may increase steadily. At present, we will focus on the specific conditions of rare earth indicators in the second half of the year.

Continue to emphasize the five core logics of this round of the rare earth sector:

1) Reasonable and abundant liquidity;

2) New energy and other downstream demand drivers. According to the China Association of Automobile Manufacturers, the production and sales of new energy vehicles from January to August reached 1.813 million and 1.799 million vehicles, an average increase of 1.9 times year-on-year. In the fourth quarter, the traditional peak season for demand is approaching, and rare earth prices are expected to be supported;

3) price increase pro-cyclical allocation strategy;

4) national policy support. Promote the promulgation of the “Regulations on the Administration of Rare Earths” as soon as possible. We expect that the regulations will be launched within this year with a high probability. National legislation will regulate the high-quality development of the rare earth industry. The industry will usher in an inflection point;

5) Davis double-clicks on performance and valuation.

We expect the prices of praseodymium and neodymium oxide, dysprosium oxide, and terbium oxide to exceed 800,000 yuan/ton, 4 million yuan/ton, and 15 million yuan/ton in 2021. The price of rare earths is expected to open up for a long time, and the profits of related companies in the rare earth industry chain are expected to be long-term. Sustainable growth, the strategic value of rare earth resources with Chinese characteristics is being reassessed.



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