SHANGHAI, Mar 21 (SMM) - Rare earth oxide supply in China exceeded 300,000 mt throughout 2021, of which the supply of praseodymium and neodymium (PrNd) oxide recorded more than 70,000 mt.
Among the four major sources of domestic rare earth oxides, supplies from domestic rare earth ores account for 49%, followed by imported rare earth ore (30%), recycling (16%) and other rare earth ores (5%).
The supply structure of PrNd oxide is different from that of other oxides. The supplies from domestic rare earth ores also come first with a proportion of 45%, followed by recycling (30%) and imported rare earth ores (19%).
Among the first batch of rare earth mining quotas in China, the mining and smelting quotas are 100,800 mt and 97,200 mt respectively. In details, the quota for light rare earth assigned to Northern Rare Earth increased by 36.5% year-on-year to 60,200 mt, ranking first among all rare earth groups. The middle and heavy rare earth mining quota distributed to China Rare Earth Group remained the same year-on-year at 7,806 mt, heading all other rare earth groups. The annual supply of oxides and PrNd oxide alone from rare earth mining in China reached 200,000 mt and 40,000 mt respectively.
In terms of rare earth ore imports, China imported a total of 27,000 mt of middle and heavy rare earth ores in 2021 including mixed rare earth carbonate and unlisted rare earth oxides. The imports from Myanmar stood at 20,100 mt, accounting for 76% of China’s total imports of middle and heavy rare earths. China imported 75,700 mt of light rare earth ores in 2021, of which the United States supplied 99.9% or 75,500 mt of them.
The capacity of US MP in 2022 is expected to remain stable and the contract renewal with domestic enterprises has been smooth. Nonetheless, the overall import situation in 2022 will not be very optimistic. The China-Myanmar border has not yet been opened in March due to severe COVID situation in Myanmar, blocking the imports of auxiliary materials, etc. In addition, Myanmar's ore production during the rainy season from June to September is likely to be halved. The supply void of imports from Myanmar will widen further. It is estimated that in 2022, the supply of oxides and PrNd oxide specifically based on imports will not exceed 60,000 mt and 20,000 mt respectively.
Strong downstream demand promotes the expansion of NdFeB magnetic material enterprises, and the development prospect of the rare earth recycling industry is promising. In addition to NdFeB scrap that takes up more than 60% of the recycling market, the dismantling of used motors is also a major source for the recycling market.
In November 2021, the Ministry of Industry and Information Technology issued the Motor Energy Efficiency Improvement, which plans to strengthen the dismantling and recycling of waste motors. The growth rate of the domestic waste motor dismantling market is set to accelerate starting from 2022. Among them, about 2,000 mt of PrNd oxide will be produced through the dismantling of waste wind turbines, and about 7,000 mt from dismantling of waste two-wheeled electric vehicles, still the largest source in the rare earth recycling market in 2022.
It is estimated that the domestic supply of rare earth oxides in 2022 will exceed 340,000 mt, and the supply of PrNd oxide will be more than 80,000 mt, an increase of over 10% YoY.
