Whether the “inflection point” of rare earth market has appeared?

According to the monitoring of business agency, the price index of domestic rare earth market continued to rise. It is obvious from the figure that the rare earth market continued to rise in the second half of the year, and the rise of rare earth market in November was eye-catching. Since November, the domestic praseodymium neodymium rare earth market has risen sharply, and the price of heavy rare earth market has risen accordingly. On November 30, the rare earth index was 793 points, the same as yesterday, down 20.70% from the highest point of 1000 points in the cycle (2011-12-06), and up 192.62% from the lowest point of 271 points on September 13, 2015. (Note: the period refers to the period from December 1, 2011 to now).

In November 2021, there were 8 rising commodities, 0 falling commodities and 0 rising or falling commodities in the list of rare earth 08 prices. The main commodities rising are: praseodymium neodymium alloy (20.35%), metal praseodymium (19.79%), metal neodymium (19.55%).

The domestic light rare earth market price has risen sharply, and the rare earth market is rising. In terms of products:

It can be clearly seen from the product price trend chart that the prices of domestic praseodymium and neodymium alloys, metal neodymium, metal praseodymium, oxide, praseodymium oxide and neodymium oxide have risen sharply. As of November 30, the price of domestic rare earth praseodymium and neodymium alloys was 1035000 yuan / ton, with a monthly increase of 20.35%; The price of metal praseodymium is 1.15 million yuan / ton, with a price increase of 19.79% this month; The price of neodymium metal is 1.07 million yuan / ton, with a price increase of 19.55% this month, and the price of praseodymium neodymium oxide is 850000 yuan / ton, with a price increase of 18.47% this month; The price of neodymium oxide is 865000 yuan / ton, with a sharp rise of 17.69% this month; The price of praseodymium oxide was 875000 yuan / ton, an increase of 14.38% this month; The market price of light rare earths in China rose sharply.

On the one hand, the trend of products in the domestic rare earth market is favorable. Due to the tight supply of electric coal in winter, the Ministry of industry and information technology and the State Administration of Market Supervision recently issued the motor energy efficiency improvement plan (2021-2023). The plan proposes to accelerate the promotion and Application of high-efficiency and energy-saving motors, encourage the development of energy-saving rare earth motors to replace traditional industrial motors, and respond to the call for energy conservation and emission reduction. There was a strong bullish mood in the venue. Many goods holding businesses did not offer prices, and the venue prices continued to rise. On the other hand, the supply and demand structure is favorable, high-end magnetic materials maintain high demand, the proportion of frequency conversion air conditioners in domestic household appliances continues to increase, and the penetration rate of Nd-Fe-B continues to increase. In addition, the demand for permanent magnet has increased significantly, the rapid development of new energy industry has driven the development of many industries, and the upstream material rare earth permanent magnet has also caught the “express” of new energy. The sales of new energy vehicles continued to rise. The demand for rare earth was at a high level, and the price of rare earth oxides rose sharply. In the absence of lock orders, rare earth metal plants mainly focused on waiting and watching, and were more cautious in procurement.

The national environmental protection supervision is still continuing, the rare earth industry is in the “C” position of carbon neutralization, and the rare earth is in the traditional peak demand season, ushering in a good era of the rare earth industry. Superimposed on the launch expectations of relevant policies in the rare earth industry, supply and demand are expected to resonate with policies, and the rare earth market continues to rise. In addition, the inventory of neodymium praseodymium oxide has been at a low level, the cargo holders have a low willingness to ship, strong reluctance to sell and wait-and-see mood, and the floor price continues to rise. The main rare earth raw materials of high-performance Nd-Fe-B are light rare earth praseodymium and neodymium oxide, heavy rare earth dysprosium oxide and terbium oxide, which are used in new energy vehicles, wind power, energy-saving frequency conversion air conditioning, traditional vehicles and other fields. According to statistics, the demand for new energy vehicles increased. According to the data released by China Automobile Industry Association, the production and sales of new energy vehicles hit a new record in October, reaching 397000 and 383000 respectively, with a month on month growth of 12.5% and 7.2%, both 1.3 times year-on-year growth. Driven by both market and policy, the demand market for vehicle gauge semiconductors broke out in an all-round way. Affected by this, the price of domestic light rare earth market rose sharply. Driven by the demand for Nd-Fe-B, the market price of heavy rare earths in China rose accordingly, but the increase was not as eye-catching as that of light rare earths.

As can be seen from the trend chart, the price of dysprosium series rose slightly in November, and the price of dysprosium oxide was 2.945 million yuan / ton, an increase of 3.51% this month; The price of dysprosium ferroalloy was 2.91 million yuan / ton, an increase of 2.46% this month; The price of dysprosium metal is 3.78 million yuan / ton, with an increase of 4.13% this month. The price of terbium in China continues to rise, the price of terbium oxide in China is 10.9 million yuan / ton, and the price of metal terbium is 14.4 million yuan / ton. The price of heavy rare earths increased little, and the market price of heavy rare earths reached a ten-year high in April. The domestic rare earth market has a good transaction situation and the leading magnetic material factory has actively purchased, which has maintained the domestic heavy rare earth market price at a high level. In the early stage, affected by the rainy season and epidemic situation, the rare earth supply in Myanmar was disturbed. In the later stage, the war in Myanmar began again, and the supply disturbance was further aggravated. The global rare earth supply is relatively concentrated. Myanmar is one of the production areas second only to China and the United States. Myanmar has a great impact on the domestic heavy rare earth market products, and the domestic supply is relatively tight. The risk of production reduction of separation enterprises using Myanmar mines in the south is increased. In addition, the contradiction between supply and demand is intensified due to the increase of domestic demand. As a result, the price trend of domestic heavy rare earth market is rising.

In addition, with the support of national policies, Wang Jiangping, Vice Minister of the Ministry of industry and information technology, pointed out in early July that it would promote the promulgation of the regulations on the administration of rare earth as soon as possible. People in the audience expected that the regulations would be introduced with a high probability within the year, and national legislation would regulate the high-quality development of the rare earth industry. Industry insiders believe that this reflects the strengthening of government control over the rare earth industry, which is conducive to the healthy development of the industry. Since 2021, the accelerated promulgation of the regulations on the administration of rare earth will, on the one hand, make the industry have laws to abide by and promote the rare earth industry chain to embark on the road of virtuous circle development; On the other hand, it reflects China’s determination to strictly control the supply order of rare earth and support the price of rare earth as an important strategic resource. The overall demand for rare earth products has increased, and the price of domestic rare earth market has risen sharply.

In October, the Ministry of natural resources made it clear that the total mining control index of rare earth mines (rare earth oxide REO, the same below) in China in 2021 was 168000 tons, including 148850 tons of rock type rare earth mines (mainly light rare earths) and 19150 tons of ionic rare earth mines (mainly medium and heavy rare earths). In 2020, the total mining control index will be 140000 tons. In 2021, the total rare earth mining control index and the total smelting separation control index will increase by 20% compared with 2020. In order to protect and rationally develop advantageous mineral resources, China strictly controls the order of rare earth supply. As a major rare earth supplier in the world, China’s export volume increased accordingly. In October, China’s rare earth export volume was 4330 tons, up 89.25% year-on-year, and the export amount was US $64.603 million, up 191.5% year-on-year; From January to October, the total export volume was 39966 tons. The strong recovery of foreign manufacturing industry also supported the warming of the domestic market to a great extent.

In the future, the new energy vehicles, wind power and variable frequency air conditioners downstream of rare earths are developing sustainably, and the demand remains high. In addition, the domestic inventory is declining, the national policy is favorable, the volume and price of exports are rising, and the on-site transaction market is good. However, due to the continuous opening of Yunnan border port recently, the reluctance of domestic raw ore merchants to sell has decreased, The wait-and-see mood of on-site purchasers increases. The opening of ports increases the circulation of rare earth raw ore market, and the operating rate of downstream processing enterprises will rise. At that time, the supply will increase. Chen Ling, an analyst of business society, expects that the rare earth market price may usher in a correction in the later stage, but the overall demand is good, and the correction range is limited.