SHANGHAI, May 12 (SMM) -

The supply of rare earth recycling and ion ore was tight after the May Day holiday. Downstream magnetic material enterprises purchased on rigid demand for long-term orders. The demand for rare earth metal spot increased slightly and the support of supply and demand fundamentals of rare earth was strong. The bullish sentiment was strong in the market and the upstream separation enterprises were unwilling to sell. Some enterprises hoarded goods with spot prices of rare earth rising rapidly. The spot prices of PrNd oxide in the market rose from 845,000 yuan/mt to 915,000 yuan/mt, an increase of 8% within two weeks after the May Day.

On the one hand, the demand for downstream orders was weak in March and April, while NdFeB magnet enterprises reduced their production, leading to the short supply of NdFeB scrap, which was transmitted to the scrap recycling enterprises.

On the other hand, scrap prices rose, with the market price of praseodymium scrap reaching 860,000-871,000 yuan/mt after the May Day, an increase of over 10% compared to the price before the holiday. The cost of scrap recycling enterprises increased, resulting in losses in enterprises.

Raw material inventory at large-scale scrap recycling enterprises in Jiangxi was sufficient, with only a slight decrease in the operating rates in May. In addition to this, some small and medium-sized scrap recycling enterprises were forced to reduce or even stop production. Only a few scrap recycling companies belonging to large rare earth groups had sufficient supply of raw materials with stable operating rates.

The supply of ion ore was also tight, with the poor output of rare earth ore from Myanmar in May. On the one hand, clearance of auxiliary materials was slow with steps like quarantine and decontamination; on the other hand, Myanmar is in the rainy season and the efficiency of mine output reduced. Domestic rare earth fundamentals are expected to move in an upward trend in May.