SMM Network News: in the first half of this year, the prices of medium and heavy rare earth products fluctuated higher due to supply and demand fundamentals and storage expectations and other factors, and the market expectations for the purchase and storage of terbium during the year was one of the main driving forces driving up the price trend of terbium and other products. After the price of heavy rare earths accelerated towards recent highs, domestic light rare earth prices also rose from the bottom in June, which may support the high prices of heavy rare earths as the market is expected to buy and store them.
Fortunately, the recovery of the new energy vehicle market has boosted the demand for rare earth downstream permanent magnet materials. At the same time, light rare earth market prices rose continuously, praseodymium neodymium oxide and praseodymium neodymium alloy prices continued to rise, light rare earth market picked up Since June, the domestic price of light rare earths has risen by about 6%.
Of course, the domestic market price of heavy rare earths remains high, the downstream inquiry increases, coupled with the hindered imports of Myanmar, the domestic market price of heavy rare earths remains high, and there is still the possibility of "polarization" in the rare earth market in the later stage.
Under such circumstances, the market has been rumored that the country will collect and store rare earths, increasing the expectations of the industry. Because the collection and storage of rare earths is expected to continue to boost the price of medium and heavy rare earths. At the same time, in the collection and storage plan, medium and heavy rare earths account for a large proportion of annual output, which is expected to have a great impact on the supply, demand and price of medium and heavy rare earths.
Through the review of the 10-year history of rare earth collection and storage, it is found that there is an obvious periodicity in rare earth collection and storage, that is, all rare earth collection and storage can be divided into three cycles from 2010 to 2015, 2016 to 2017 and 2018 to the present, showing the characteristics of "expectation + commercial reserve + state reserve" cycle. Small cycle, that is, in each year in which stock collection occurs, the stock market is similar, showing the cycle characteristics of "expectation (+ callback) + collection execution + collection completion".
Since 2018, due to fluctuations in rare earth prices and other reasons, the relevant government departments have not carried out rare earth collection and storage operations. So, will this year become the fourth round of rare earth collection and storage cycle? This is bound to cause a lot of speculation. If the fourth round of collection and storage cycle can come true, it will undoubtedly give a significant boost to the price of rare earths.
This year is the last year of the 13th five-year Plan. It is estimated that during the 13th five-year Plan period, dysprosium oxide and terbium oxide accounted for 52% and 190% of the output of heavy rare earths respectively in 2019. Considering that Myanmar's customs closure still has a tight impact on the domestic import supply of medium and heavy rare earths, once the collection and storage plan is implemented as scheduled, it will have a greater impact on the supply, demand and price of heavy rare earths such as dysprosium and terbium.
Further analysis, if rare earth products are collected and stored within this year, the prices of medium and heavy rare earth products such as terbium may remain strong and strong in the future. At present, the prices of dysprosium oxide and terbium oxide are near the 2019 highs. Short-term prices such as dysprosium oxide and terbium oxide are likely to slow down at the existing prices or increase, but they are expected to be mainly positive in the medium and long term.
Now the relevant government departments implement the collection and storage of rare earths, which can send a positive signal to the market and give enterprises a reassurance, which is very good for the price stability of rare earths.
Of course, we should look at the impact of rare earth collection and storage on the market objectively. At present, what is different from the past is that there is a demand for a certain amount of funds from many shippers and rare earth production enterprises. although the relevant news about the acquisition and storage is constantly updated, the domestic price of heavy rare earths has risen sharply in the early stage, and the price has approached an all-time high.
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