Rare Earth Office Interviewed Key Enterprises on Price of Rare Earth

Source: Ministry of Industry and Information Technology

In view of the continuous rise and high market prices of rare earth products, on March 3, the rare earth office interviewed key rare earth enterprises such as China Rare Earth Group, North Rare Earth Group and Shenghe Resources Holdings.

The meeting required that relevant enterprises should earnestly enhance their awareness of the overall situation and responsibility, correctly grasp the current and long-term, upstream and downstream relations, and ensure the safety and stability of the industrial chain and supply chain. They are required to strengthen industry self-discipline, further standardize the production and operation, product trading and trade circulation of enterprises, and shall not participate in market speculation and hoarding. Moreover, they should give full play to the leading role of demonstration, promote and improve the pricing mechanism of rare earth products, jointly guide product prices to return to rationality, and promote the sustainable and healthy development of rare earth industry.

Huang Fuxi, rare earth analyst of rare earth and precious metals division of Shanghai Steel Union, told that the interview with key rare earth enterprises by the Ministry of Industry and Information Technology has a great impact on market sentiment. He expects rare earth prices to loosen in the short term or affected by the above sentiment, but the decline remains to be seen.

Affected by tight supply and demand, rare earth prices have been rising recently. According to the data of China Rare Earth Industry Association, the domestic rare earth price index hit a record high of 430.96 points in mid and late February, up 26.85% from the beginning of this year. As of March 4, the average price of Praseodymium and Neodymium oxide in light rare earths was 1.105 million yuan / ton, only 13.7% lower than the historical high of 1.275 million yuan / ton in 2011.

The price of Dysprosium oxide in medium and heavy rare earths was 3.11 million yuan / ton, up about 7% from the end of last year. The price of Dysprosium metal was 3.985 million yuan / ton, up about 6.27% from the end of last year.

Huang Fuxi believes that the main reason for the current high price of rare earth is that the current inventory of rare earth enterprises is lower than that of years ago, and the market supply can not meet the demand. The demand, especially Neodymium magnet for the electric vehicle market grows quickly.

Rare earth is a product that the state strictly implements the total production control and management. The mining and smelting indicators are issued by the Ministry of industry and information technology and the Ministry of Natural Resources every year. No unit or individual may produce without and beyond the indicators. This year, the total indicators of the first batch of rare earth mining and smelting separation were 100800 tons and 97200 tons respectively, with a year-on-year increase of 20% compared with the first batch of mining and smelting separation indicators last year.

Huang Fuxi said that despite the year-on-year growth of rare earth quota indicators, due to the strong demand for rare earth magnetic materials in the downstream this year and the reduction of inventory of upstream processing enterprises, the market supply and demand is still tight.