1. Total Volume and Operating Rates: Moderate Expansion in September, Accelerated Growth Expected in October
According to SMM research, the national NdFeB blank output in September 2026 was 32,349 tons, with an industry average operating rate of 75.68%, representing a month-on-month (MoM) increase of 3.34%. The projected output for October is 34,014 tons, with an average operating rate of 79.57%, a MoM increase of 5.15%. From the perspectives of total volume and operating rates, September's output saw only a moderate expansion compared to August, while the expected growth rate for October significantly increased to over 5%, with the industry average operating rate rising from 75.68% to 79.57%. This rhythm of "low growth in September and accelerated growth in October" contrasts sharply with the traditional pattern of front-loaded volume during the "Golden September and Silver October" peak season. It essentially reflects the delayed release of terminal demand and adjustments in the production scheduling logic of magnetic material enterprises.
2. Enterprise Segmentation: Top-Tier at Full Capacity, Mid-Tier at Half Capacity, Bottom-Tier Flat, Exacerbating Polarization
From the perspective of enterprise segmentation, the output increase in September mainly came from top-tier enterprises. Top-tier enterprises operated at full capacity in September, with operating rates generally exceeding 80%, serving as the core force driving the industry average operating rate to 75.68%. Mid-tier enterprises varied by situation, maintaining an average operating rate of 65%, showing a significant gap compared to the top tier. This indicates that mid-to-high-end orders, stable customer relationships, and delivery capabilities remain key factors determining operating rates. Bottom-tier enterprises saw their September orders and operating rates remain largely flat compared to the previous month, with little fluctuation. Against the backdrop of an overall output increase of 3.34%, they did not make an effective contribution. Consequently, the polarization in the magnetic materials industry has become increasingly evident: top-tier enterprises absorb industry increments through order density and capacity utilization improvements; mid-tier enterprises adjust based on order and profit elasticity; while bottom-tier enterprises are more constrained by customer structure, product grade capabilities, and capital turnover. The overall pattern presents an echelon of "top tier full, mid-tier half, bottom tier flat."
3. Lagging Peak Season: The "Golden September" Pattern Absent, Shifting the Pace of Incremental Volume
It is particularly noteworthy that this September did not follow the usual "Golden September and Silver October" pattern, but instead showed a clear lag. Compared to August, September's output increased by only 3.34%, while the expected increase for October exceeds 5%. The reasons for this rhythmic shift can be summarized into three aspects.
First, under the influence of the macro environment, terminal consumption remained sluggish in September. Demand increments from automobiles, industrial motors, home appliances, and some electromechanical products were limited, weakening the increment brought to NdFeB blanks, and enterprises lacked strong terminal order drivers for production scheduling. SMM's recent morning meetings also mentioned that in September, affected by the overall consumption environment, the increment in terminal output was limited. Although the operating rate of main drive motor factories increased somewhat, it was difficult to offset the overall downward trend in industrial motors, resulting in average activity in the NdFeB sector.
Second, although the frequency of inquiries from overseas markets remained at a high level, actual demand was limited. Moreover, relevant departments strengthened export verification, and prolonged processes led to delays in delivery times for overseas customer orders, making it difficult to reflect in September's output. From August to September 2026, NdFeB exports generally featured "slowed processes and more detailed reviews," with stricter checks on end-use, consignees, resale risks, and military sensitivity. Although this did not result in a comprehensive ban, the customs declaration and certification cycles for some orders were lengthened. During this refinement stage, even with active inquiries, actual shipments and factory revenue recognition may still be delayed.
Third, and most importantly, prices of PrNd (praseodymium-neodymium) metal remained high and stable in September. Under the gloomy macro environment, motor and terminal enterprises preferred to operate with low inventory levels, maintaining only essential procurement to reduce the pressure on working capital caused by uncertain stockpiling. In September, the light rare earth PrNd series was generally strong, with prices of praseodymium-neodymium oxide and metal experiencing multiple high-level fluctuations. Downstream magnetic material and terminal enterprises were less willing to accept high prices, focusing procurement on essential needs. With costs not declining and demand not scaling up, procurement decisions shifted from "seasonal advance" to "replenishment after order confirmation."
4. Shift in Procurement Logic: Demand Postponement Under Low Inventory Strategy
Under the combination of the above three factors, the stocking originally planned for September was delayed to October, the first month of the fourth quarter, for release. For magnetic material enterprises, low inventory operation reduces the risk of price declines but also compresses the order base for blank conversion in September. For motor and terminal enterprises, high PrNd metal prices mean increased raw material costs. Given the uncertainty in terminal prices and shipment volumes, postponing bulk stocking and switching to small-batch replenishment based on production plans is a more prudent working capital management solution. Therefore, September's 3.34% MoM output increase should not be simply interpreted as weak demand, but rather as an expansion of the time lag between order confirmation and blank production scheduling.
5. October Outlook: Replenishment of Lagged Demand Resonates with Q4 Year-End Rush
Based on SMM expectations, the national NdFeB blank output in October is projected to be 34,014 tons, with an industry average operating rate of 79.57%, a MoM increase of 5.15%. The core support for this expectation does not come from a sudden change in new macro demand, but rather stems from the lag in September demand and early stocking for year-end rushes in the fourth quarter. On one hand, orders that did not convert into blanks in September due to export verification, low inventory, and price wait-and-see will enter production scheduling in October. On the other hand, there are year-end rush demands for new energy vehicles, wind power, industrial motors, and some export deliveries in the fourth quarter. To avoid uncertainties in subsequent delivery times, terminals may lock in magnetic material supply earlier than in previous years. If overseas verification processes continue to advance with complete documentation, end-use purposes, and end-user materials, some delayed orders are expected to be gradually confirmed in October and the fourth quarter, thereby supporting top-tier enterprises to maintain operating rates above 80% and driving the industry average operating rate closer to 79.57%.
6. Conclusion
Overall, the September data reflects a "postponement of the peak season" rather than its "disappearance." The 32,349 tons and 75.68% operating rate in September form a moderate base, while the 34,014 tons and 79.57% operating rate in October reflect the replenishment of lagged demand. At the enterprise level, the pattern of high load for top-tier, average 65% for mid-tier, and flat for bottom-tier is difficult to change in the short term. Industry resources and orders continue to concentrate on top-tier enterprises with strong delivery capabilities, complete compliance materials, and comprehensive grade coverage.
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