Demand&Emotion：Pr-Nd Material Prices is Soaring【SMM Analysis】

SMM August 19 News: Recently, the prices of Pr-Nd oxide and Pr-Nd alloy have shown a remarkable increase, which is not accidental but the result of multiple driving factors overlapping and resonating with each other.

First, with the arrival of the traditional peak production season, demand from downstream sectors for rare earths has been significantly boosted. The continuous growth in NEVs and energy-efficient home appliances has led to a steady increase in market demand.

This trend has spurred a surge in orders for rare earth permanent magnet companies, prompting them to ramp up production, thereby creating strong and rigid procurement support for Pr-Nd oxide and Pr-Nd alloy. Such robust demand has laid a solid foundation for price increases.

Second, market speculation centered around expectations of supply contraction, stricter environmental protection policies, and geopolitical factors further fueled the upward price momentum.

These news items significantly boosted bullish sentiment across the industry chain, leading market participants to generally expect prices to continue rising. Under this psychological expectation, suppliers widely adopted a strategy of holding back cargoes, resulting in a significant reduction in the circulation of Pr-Nd oxide spot cargo, which intensified market tensions. This artificially created tight supply situation further drove up prices.

Meanwhile, external active funds and traders also keenly picked up on the bullish signals from the market. They actively entered the market to participate in speculative buying, using their financial advantages to push prices higher. This behavior triggered a sharp increase in inquiries and actual procurement volumes for Pr-Nd products, further amplifying buying power.

Taking all these factors into account, the price center of Pr-Nd oxide and its downstream product, Pr-Nd alloy, surged rapidly in the short term. This upward trend was not only swift but also saw an increase that quickly exceeded 20%, setting a new high recently.

However, as prices soared, a fear of high prices gradually emerged in the market. Downstream buyers, concerned about a pull back in prices, showed a marginal decline in their purchase efforts. Although the sentiment for further increases remained strong, it is also important to be cautious of the risk of a pullback caused by speculative sentiment driving up prices artificially.