Positive commentary from China this week>
Pr-Nd alloy
In April 2024, domestic Pr-Nd alloy output was 5,866 mt, a month-on-month increase of 2.13%. End-user demand improved steadily after heading into the second quarter, boosting Pr-Nd alloy demand and driving down stocks at alloy producers rapidly. Some alloy producers saw output growth in April. The rare earth market embraced peak season.
Backed by robust orders on hand, magnetic material production is on track to stay high in May. However, profit growth may be lower than expected amid fierce competition. Pr-Nd alloy production is poised to sustain growth in May, driven by strong demand.
Pr-Nd oxide
The domestic production of Pr-Nd oxide reached 5,967 mt in April 2024, up 0.37% month-on-month, with significant growth mainly seen in Guangxi.
According to the SMM survey, in April, some separation plants in Jiangxi suspended production for maintenance, resulting in a slight decrease in local Pr-Nd oxide output month-on-month. Although the import volume of rare earth ore from the US declined, some separation plants still had unconsumed raw material inventories, and local rare earth ore in Sichuan could also make up for the shortage of US ore. Thus, there was no significant change in local Pr-Nd output. In April, Pr-Nd prices showed a bullish trend. Some separation plants in Guangxi increased their operating rates, leading to a 17% month-on-month increase in local Pr-Nd oxide output.
Dysprosium oxide
The domestic production of dysprosium oxide in April 2024 was 217 mt, with a month-on-month decline of 0.8%. The decline was mainly reflected in Jiangxi region.
According to SMM, some separation plants in Jiangxi underwent equipment maintenance in April and did not resume production that month, resulting in a month-on-month decline of 3% in local dysprosium oxide output. It is reported that due to environmental protection reasons, the separation plants in Longnan area will be shut down in May, and it is expected that the production of rare earth oxides in Jiangxi will continue to decline in May.
Terbium oxide
In April 2024, domestic production of terbium oxide was 40.8 mt, down 4.2% month-on-month. The decline was mainly reflected in Jiangxi, where output fell by about 12%.
According to the SMM survey, some separation plants in Jiangxi underwent equipment maintenance in April, resulting in the suspension of production that month, and the month-on-month output of terbium oxide in the region showed a significant decline. Some companies said that due to environmental protection reasons, separation plants in Longnan are expected to suspend production in the near future, and it is expected that the production of terbium oxide in Jiangxi will continue to decline month-on-month in May.
Gadolinium oxide
In April 2024, domestic gadolinium oxide production was 306.2 mt, a month-on-month decrease of 1%, with the main reduction reflected in Jiangxi.
According to SMM, some separation plants in Jiangxi are about to suspend production. Some companies have already started to suspend production as early as April. The local gadolinium oxide production has shrunk by 13% in April, and is expected to continue to shrink in May.
Holmium oxide
In April 2024, domestic holmium oxide production was 43 mt, a month-on-month decrease of approximately 2%. Production in Guangxi and Jiangsu both decreased to a certain extent month-on-month.
According to SMM research, due to equipment maintenance by some companies, the output of holmium oxide in Guangxi and Jiangsu has decreased month-on-month. The output in Guangxi has decreased by approximately 9% month-on-month, and the output in Jiangxi has decreased by 12%.
With improving demand putting pressure on alloy inventory the flow thru to oxides will follow quickly explaining the steady rise in all mag inputs, against a background of some production issues.
Suggests confidence prices will continue rising into the peak mag season with the SP continuing to track NdPr, noting Lynas bottomed 2 weeks before NdPr and has moved up in tandem since.
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