BEIJING, Feb. 25 (Xinhua) -- Rare earth prices in China are expected to continue rising in the short term thanks to the robust demand from downstream sectors, the Xinhua-run Economic Information Daily reported on Thursday.
Caitong Securities pointed out that despite the increase in the output quotas for rare earth, it is difficult to increase the output in the short term. Given the rising demand from the downstream sectors in the peak season after the Spring Festival holiday from February 11 to 17, the price will continue rising in the short term.
China has recently set the first batch of quotas for rare earth mining, and smelting and separation this year. Specifically, the mining quota for rare earths is set at 84,000 metric tons (tonnes), up 27.3 percent year on year, and the quota of the rare earth smelting and separation stands at 81,000 tonnes, up 27.6 percent year on year.
Industry insiders said that the increase in the quotas is mainly to meet the fast-growing downstream demand.
Rare earth prices have been on the rise recently. Data of the 100ppi.com, a commodity information provider in China showed that the domestic rare earth prices have started a new round of price hike since May last year. The prices of rare earths such as praseodymium and neodymium oxide have increased by about 50 percent since their lows.
The industry insiders believed that the demand for rare earths is mainly for permanent magnet materials, with neodymium iron boron (NdFeB) as the main target. At present, the improving demand for the high-performance NdFeB has been the main driving force for the price increase of rare earth products. The rapid development of new energy vehicles (NEVs) and other emerging industries will help drive the growth in the high-performance NdFeB demand.
It is noted that the demand for high-performance NdFeB comes mainly from the automobiles, wind power and variable frequency air conditioners. (Edited by Hu Pingchao with Xinhua Silk Road, hupingchao@xinhua.org)
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