According to the commodity market analysis system of the business community, the price index of the domestic rare earth market rose slightly, and the domestic medium and heavy rare earth market recovered slightly. On May 18, the rare earth index was 442 points, 56.11% lower than the cycle’s highest point of 1007 (2022-02-24), and 63.10% higher than the lowest point of 271 on September 13, 2015. (Note: The cycle refers to the period from December 1st, 2011 to the present)

The prices of domestic dysprosium oxide, dysprosium iron alloy, terbium oxide, and metallic terbium have slightly rebounded. As of the 19th, the price of dysprosium oxide was 2.055 million yuan/ton, an increase of 7.87% compared to the beginning of the month; The price of dysprosium iron alloy was 1.99 million yuan/ton, an increase of 6.13% compared to the beginning of the month; The price of dysprosium metal is 2.63 million yuan/ton, with a stable price trend; The price of terbium series in China has mainly increased, with terbium oxide prices reaching 8.2 million yuan/ton and metal terbium prices reaching 10.3 million yuan/ton.

In mid May, the heavy rare earth market rebounded slightly, and the recent inquiries increased. In addition, the price of rare earth in the early period has declined for a long time. Affected by the small increase in demand, the domestic market price of heavy rare earth rebounded. The domestic medium and heavy rare earth market is relatively active in terms of inquiry and quotation, with a slight increase in trading volume. However, downstream demand is still weak, metal factory orders are relatively scarce, and magnetic material factories mainly consume existing inventory. In addition, with an increase in rare earth mines from Southeast Asia, the supply of rare earth is sufficient, and the pessimism in the rare earth market remains heavy.

According to statistics, the production and sales of new energy vehicles completed 640000 and 636000 units respectively in April, a year-on-year increase of 1.1 times. The sales of new energy vehicles accounted for 29.5% of the total sales of new vehicles. From January to April, the total production and sales of new energy vehicles reached 2.291 million and 2.222 million, respectively, with a year-on-year increase of 42.8%. The sales of new energy vehicles accounted for 27% of the total sales of new vehicles. Recently, the country has accelerated the construction of charging infrastructure to better support the entry of new energy vehicles into rural areas, which is conducive to unleashing the consumption potential of rural areas, increasing the sales of new energy vehicles, and increasing the production and sales of new energy vehicles, which is beneficial for the domestic prices of medium and heavy rare earths.

After years of governance, the domestic rare earth industry has gradually formed a supply pattern with large groups as the main body and relatively concentrated raw materials. With the continuous development of the foreign rare earth industry, China’s share of rare earth production has decreased from 90% to 70%. According to statistics, China’s rare earth export data in April remained generally flat, with imports increasing by 52.3% compared to the previous month. From January to April 2023, a total of 16411.2 tons of rare earth commodities were exported, a year-on-year decrease of 4.1%; From January to April, imported rare earth commodities reached 59643.8 tons, a year-on-year increase of 41.9%. The increase of China’s imports of rare earth commodities has correspondingly suppressed the price rise of domestic medium and heavy rare earth markets.

Future forecast: The supply of rare earth production enterprises is normal in the near future, and the downstream demand has not changed much. It is expected that the price of heavy rare earth market will fluctuate and rise mainly in the short term. In the medium and long term, there is a lack of primary and renewable supply sources. Dysprosium and terbium oxides will also face shortages. In addition, driven by emerging and traditional demands such as energy-saving motors, industrial robots, wind power, variable frequency air conditioners, consumer electronics, the global demand for rare earth permanent magnets is expected to continue to grow.