SHANGHAI, Jan 24 (SMM) - The output of praseodymium and neodymium (PrNd) alloy in January is expected to rise slightly from the previous month. The increase was mainly contributed by Inner Mongolia and Sichuan, the major consuming places of light rare earth ores, where the PrNd alloy output rose steadily since December 2021.
The demand for mid and high-end NdFeB in downstream sectors like new energy vehicles (NEVs), wind power generation, and two-wheeled electric vehicles has been strong. Large-sized magnetic material companies had sufficient overseas orders. In order to match the expanding NdFeB production capacity and terminal demand, metal enterprises in Inner Mongolia, Sichuan and other places have increased the production. Some metal enterprises have being ramping up the production for two straight months since December 2021.
A large rare earth group in the north plans to deploy across the entire rare earth industry chain from the upstream to the downstream by extending to other metal businesses and expanding the PrNd alloy capacity. Some metal companies in Inner Mongolia that have business co-operation with Northern Rare Earth Group have already increased the output in January.
At the same time, the group has completed the merger with a metal factory in Baotou, and the new metal production line is expected to be completed in mid-2022, when the expansion project of PrNd metal production capacity will be completed. It is expected that the supply of PrNd metal in major consuming areas of light rare earth ores will increase in 2022 and onwards.
The output of PrNd alloy in Jiangxi, Hunan, Guangdong and Guangxi, the major consuming areas of middle and heavy rare earth ores, was largely flat from that in December 2021. In addition, many metal companies have already finished the restocking of all raw materials after the intensive purchases in early January.
Most rare earth metal manufacturers will maintain production during the CNY holiday as the shutdown of electric furnaces will result in great losses of equipment. And only several metal manufactures reduced the operation of some production lines. The output of PrNd alloy in February is expected to be flat MoM.
The output of PrNd oxide in January is expected to remain unchanged on a monthly basis. The main increase came from some NdFeB scrap enterprises in Jiangxi, while the reduction was contributed by some separation enterprises in south China.
In terms of the supply of NdFeB scrap, NdFeB scrap enterprises will stop the production for maintenance in February. In the short term, the output of PrNd oxide from NdFeB scrap will be reduced in February.
A large rare earth group in the north will extend its business to scrap recycling in the Longnan area in Ganzhou to realise the industrial chain cycle of metal and NdFeB scrap. It is expected that the supply of PrNd oxide from NdFeB scrap will increase in 2022 and onwards.
The PrNd oxide output in Inner Mongolia, Shandong, Sichuan and Gansu, the major consuming areas of light rare earth ores, will extended its stability in December 2021. At present, the output of upstream oxides was unable to match the continuously expanding NdFeB magnetic material production capacity and terminal demand. There are also problems such as insufficient separation/smelting quotas in major consuming areas of light rare earth ores.
The output of PrNd oxide in Jiangxi, Hunan, Guangdong and Guangxi, the major consuming areas of middle and heavy rare earth ores, was largely flat from that in December 2021, and stood low in January. The above-mentioned regions are highly dependent on the imports of rare earth ores from Myanmar, although Myanmar rare earth ores have completed the customs clearance, the companies in these regions were unable to increase the output in January due to high purchase costs and insufficient separation quotas. And some separation companies plan to suspend the production for maintenance in February. The PrNd oxide output in February is likely to fall slightly in February.
The downstream demand was strong, and some magnetic material companies have run out of rare earth metal stocks. It is expected that the market procurement demand for PrNd products will pick up in February. In addition, the overall supply tightened, and the gap between supply and demand in the rare earth market is expected to expand in February.
