China Northern Rare Earth forecasts 134.95%–138.84% YoY net profit growth for the first three quarters, with major rare earth products consolidating at highs

The Q3 earnings forecast released by China Northern Rare Earth shows: according to preliminary calculations by the company's finance department, net profit attributable to owners of the parent company for the first three quarters of 2026 is expected to be RMB 3.62 billion to RMB 3.68 billion, an increase of RMB 2.08 billion to RMB 2.14 billion compared with the same period last year (statutory disclosed data), up 134.95% to 138.84% YoY. Net profit attributable to owners of the parent company excluding non-recurring gains and losses for the first three quarters of 2026 is expected to be RMB 3.63 billion to RMB 3.69 billion, an increase of RMB 2.27 billion to RMB 2.33 billion compared with the same period last year (statutory disclosed data), up 166.64% to 171.04% YoY.

Regarding the main reasons for the forecast earnings growth, China Northern Rare Earth stated:

From January to September 2026, the company served the national rare earth resource strategy and the construction of a new energy system, and fully implemented safety control requirements across the rare earth industry chain. Constrained by raw material supply on the market side, combined with the multi-point release of demand in downstream sectors such as new energy and high-end equipment, prices of major rare earth products generally consolidated at highs. The company focused on its annual production and operation targets, coordinated planning and advanced various operational tasks, strengthened comprehensive budget management, and deepened cost reduction, quality improvement, and efficiency enhancement; strengthened marketing operations and scientifically organized production schedules; strengthened group control and risk prevention, deepened reform and innovation, integrated and advanced sustainable development, compliance, lean management, safety, and other management work, accelerated the construction of key projects, cultivated new quality productive forces through technological innovation, and continued to release synergies across the entire industry chain, strongly supporting the significant YoY growth in the company's operating performance in the first three quarters.

In production and marketing, the company practiced the concept of green development, adhered to the quality philosophy of "users first, brand supreme," continuously optimized production coordination and production system management, and promoted process technology upgrades. Production of major products such as rare earth smelting and separation, rare earth metals, and rare earth magnetic materials reached new highs. The company continuously optimized its product structure, developing customized and specialized high-value-added new rare earth products such as low-chloride cerium carbonate and small-particle-size lanthanum oxide. It continuously expanded product application scenarios and strived to build a new rare earth industry landscape featuring full-category coverage and high-value utilization. It continuously optimized the full processing cost of rare earth products, conducted horizontal and vertical multi-dimensional benchmarking, precisely identified gaps, and implemented targeted measures to tap potential, further reducing the full processing cost of rare earth products YoY. It continuously optimized and adjusted sales strategies, ensured raw material supply based on market demand, advanced overall sales progress in an orderly manner according to targets, and steadily carried out market development, client maintenance, and order fulfillment. It continuously digested historical inventory, with average prices and sales of lanthanum-cerium products rising YoY. It continuously empowered energy conservation and carbon reduction in industries such as new energy, leveraging the advantages of high-quality rare earth materials, with sales of rare earth metals, magnetic materials, and polishing materials achieving varying degrees of growth YoY.

In terms of key project construction, the company continued to consolidate its scale advantages and synergies across the entire industry chain, and accelerated the construction of key projects. Phase I of the green smelting upgrade and transformation project has been put into operation, with the entire production line fully connected;

Phase II construction is progressing in an orderly manner, with the main process plant buildings largely completed and equipment installation underway; the rare earth high-level technological innovation platform construction project is advancing in an orderly manner, and the preliminary design expert review has been completed;

the secondary resource utilization growth and capacity expansion project has been put into operation. The company continued to efficiently advance industry chain extension, reinforcement, and strengthening projects such as mergers and acquisitions, restructuring, and joint ventures. It established new joint ventures with Ningbo Funeng Rare Earth New Materials Co., Ltd. and Ningbo Shuoteng New Materials Co., Ltd., with the new companies serving as the entities for constructing a rare earth metal alloy production line project and a cerium-containing NdFeB magnetic material project. Both projects are currently undergoing business registration.

In terms of R&D and innovation, the company strengthened its research strengths and achieved fruitful scientific and technological innovation results. It organized applications for 18 national-level projects and 28 provincial-level projects. It undertook and participated in 7 national-level projects and 32 provincial-level projects, formulated or revised 41 standards of various types, and filed 107 patent applications, continuously enhancing its ability to serve major national and regional scientific and technological strategies. The company strengthened the commercialization of research outcomes, achieving 2 research commercialization results (1 new product and 1 new technology). It strengthened technological innovation and standards development, leveraged the role of rare earths as an important element of new quality productive forces, and overcame 1 core technology: "batch preparation technology for nano cerium oxide polishing slurry for integrated circuits." It developed 4 new products: praseodymium metal products, nano alumina polishing slurry specifically for sapphire glass, antimony-substitute rare earth hybrid flame retardants, and rare earth polishing slurry for high-precision optical fibers. It also developed 2 new equipment items: a filling system for multi-channel solid-state hydrogen storage cylinders and a 2.2kW industrial permanent magnet motor, driving iterative upgrades in process technology and equipment manufacturing capabilities. The company hosted a national-level advanced training program on "Applications of Rare Earth New Materials and Products in Embodied AI and Low-Altitude Economy," building an industry innovation exchange platform, introducing cutting-edge technology concepts, and strengthening the talent foundation for strategic emerging industries.

Regarding its 2026 operating plan, China Northern Rare Earth announced in its 2025 annual report: 2026 is the opening year of the "15th Five-Year Plan" and an important year for the company to advance high-quality development and accelerate its efforts to become a world-class rare earth leader. The company will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, take forging a strong sense of community for the Chinese nation as the main line, fully implement the spirit of the 20th National Congress of the Communist Party of China and all plenary sessions of the 20th Central Committee, and implement the important instructions of General Secretary Xi Jinping on Inner Mongolia and the rare earth industry, as well as the decisions and arrangements of higher authorities including the Inner Mongolia Autonomous Region and Baotou City. The company will adhere to the general principle of seeking progress while maintaining stability, fully, accurately, and comprehensively implement the new development philosophy, bravely shoulder its responsibilities and missions, steadily improve operating quality and efficiency, build a full-element and full-category industrial system, promote the deep integration of technological innovation and industrial innovation, accelerate the pace of deepening reforms, enhance modern governance, continuously strengthen core functions and improve core competitiveness, accelerate the building of a world-class rare earth leader, achieve a good start for the "15th Five-Year Plan," and make new and greater contributions to the construction of the "Two Rare Earth Bases."Main operational targets for 2026 (these targets are planning objectives only, and there is uncertainty as to whether they can ultimately be achieved; they do not constitute a substantive commitment by the company to investors. Investors and relevant parties should maintain sufficient risk awareness in this regard and should understand the differences between plans, forecasts, and commitments): achieve operating revenue of more than 44 billion yuan and total profit of more than 3.5 billion yuan. On the premise of meeting the operational targets, achieve synchronized linkage between employee income and the company's economic performance and labor productivity.

A review of SMM Pr-Nd oxide price trends in the first three quarters shows that the average price of Pr-Nd oxide on September 30 was 739,500 yuan/mt, up 21.93% from its average price of 606,500 yuan/mt on December 31, 2025. The daily average price of Pr-Nd oxide in the first three quarters of this year was 740,546.96 yuan/mt, up 57.46% YoY from the daily average of 470,306.01 yuan/mt in the first three quarters of 2025.

According to SMM quotations, on October 12, the average price of Pr-Nd oxide edged up from the previous trading day. On that day, the quotation range for Pr-Nd oxide shifted slightly higher, low-priced cargoes tightened further, and suppliers' willingness to hold prices firm continued to provide support. Pr-Nd alloy quotations remained stable, with the alloy segment maintaining existing offers amid the squeeze between rising costs and limited downstream acceptance, and had yet to follow the adjustment in raw materials. On the trading front, downstream magnetic material enterprises continued to purchase mainly on a need-to basis, with actual orders following up slowly. Most held a wait-and-see attitude toward oxides after the price increase, and the price rise still lacked support from trading volume.

Regarding the market outlook: in the short term, the market is still in a post-holiday recovery phase, and the price direction will depend on the pace of downstream magnetic material order releases. The Pr-Nd series, caught between raw material cost support and limited downstream acceptance, is likely to move sideways in a narrow range in the short term.