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Commodity Market Report 31 March 2022

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Report summary

The use of rare earth permanent magnets in key energy transition technologies continues to support strong demand growth for key rare earth elements into 2022. The availability of feedstock material and refined products in the Chinese market has placed significant upward pressure on prices for in demand elements including neodymium, dysprosium and terbium. The influence of the Chinese government to the global rare earth market has been highlighted in Q1 2022, with major market consolidation, quota changes and pressure to lower pricing levels. The remainder of 2022 will be a pivotal stage in the future growth of the rare earth industry. Downstream consumers are cautious of price volatility, supply availability and the geographical concentration of the market. This is driving some to investigate substitution and thrifting of rare earths from their products, with potential to impact the longer term demand outlook.

Pricing
- Prices reach new 10 year highs before reversal in price trend
- MIIT intervenes to bring rare earth pricing to lower levels
- Chinese quota increase sees limited price response from domestic industry
- Forecast prices for key magnet alloy elements remain supported by strong demand growth
- Heavy rare earth prices forecast to stabilise towards mid-2020s as supply availability improves
Market balance
- Neodymium supply defines the rare earth market
- Rare earth elements to remain in significant oversupply
- Diverging trend between magnet and non-magnet materials
Demand
- Permanent magnet applications will further increase their share of rare earth demand
- Growth in EV sales and production critical to rare earth demand growth
- Wind energy championed as alternative to Russian oil and gas
Supply
- Mine supply to become increasingly diversified
- Alternative sources of rare earths: future growth opportunities
- Refined supply set to remain China-centred
- Secondary supply will grow in importance
- Lanthanum and cerium oxides
- Risks to the base case
- Neodymium, praseodymium, and Nd-Pr oxides
- Risks to the base case
- 12 more item(s)...
Overview
- Changes since Q4 2021
- Magnet applications
- Catalyst applications
- Polishing powders
- Batteries
- Glass
- Metallurgical
- Minor applications
- 31 more item(s)...