The Regulations on the Administration of Rare Earths, which are scheduled to come into force on October 1, 2024, emphasize the country's unified planning for the rare earth industry, and actively encourage and support the R&D and application of new technologies, new processes, new products, new materials and new equipment in the rare earth industry. At the same time, the regulations clearly stipulate that rare earth production enterprises must comply with relevant laws and regulations such as mineral resources, energy conservation and environmental protection, clean production, safe production and fire protection to ensure the realization of green development and safe production.
The core content of the regulations focuses on the quota system, improving the national reserve system, regulating the separation of smelting, comprehensive utilization, import and export and other key industrial links. At the same time, the regulations also encourage the research and development of new rare earth technologies and the recycling of secondary resources.
Rare earth is a national strategic emerging industry, the promulgation of the regulations marks that the collective and standardized development of the rare earth industry will be established in the form of laws and regulations, and the supply concentration of the domestic rare earth industry is expected to be further improved.
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An overview of the rare earth industry
Rare earth is known as the "vitamin of industry", with excellent magnetic, optical and electrical properties, can significantly improve the performance of various products, and is an indispensable key basic material in the field of high-end equipment such as new energy vehicles, industrial robots, electronic information, aerospace and so on.
Rare earth elements include lanthanides in the periodic table, as well as scandium and yttrium, a total of 17 metallic elements, mainly in their oxide form (REO), which makes the separation process of rare earths very challenging.
However, it is worth noting that the development of rare earths has a certain impact on the ecological environment. Mild radioactive slurry tailings produced from the rare earth elements thorium and uranium can pose a serious hazard if not properly handled. In addition, the use of toxic acids in the refining process of rare earth elements can also cause a series of environmental problems, including soil erosion, landslides, ground cracks and subsidence, destruction of high-quality farmland, and heavy metal pollution. Therefore, environmental factors in the development and utilization of rare earth land are also important links.
Rare earth industry chain combing
The rare earth industry chain includes three core links: upstream rare earth mining, midstream rare earth smelting and separation, and downstream rare earth processing and various terminal applications.
From the perspective of industry output value, the value of upstream praseodymium-neodymium and dysprosium-terbium is significant; Downstream NdFeB magnets dominate. Praseodymium-neodymium-terbium-terbium oxide is converted into praseodymium-neodymium and dysprosium-terbium metal, which is further processed into NdFeB, which is finally used in electrical machinery and automobiles, forming the core chain of the rare earth industry, which is closely connected with the downstream demand for rare earth magnets and new energy. The main layout manufacturers of domestic rare earth permanent magnet materials include Zhongke Sanhuan, Jinli Permanent Magnet, Ningbo Yunsheng, Zhenghai Magnetic, Earth Bear, Jintian Copper, Antai Technology, etc.
The main manufacturers of rare earth permanent magnets are sorted out:
Source: China Rare Earth Industry Association
The direct raw materials for rare earth permanent magnet materials are rare earth metals such as the metal praseodymium neodymium and dysprosium terbium. In order to obtain these rare earth metals, suppliers need to mine rare earth ores, and the composition of rare earth elements in different rare earth ores varies, which makes the corresponding value of rare earth ores also vary. In general, the value of medium and heavy rare earth ores (such as ionic rare earth ores and monazite) is higher than that of light rare earth ores (such as bazite fluorocarbon).
In addition, rare earth metals and their oxides can be converted into a variety of downstream materials through precision processing, including rare earth magnetic materials, rare earth luminescent materials, rare earth catalytic materials, rare earth alloy materials, and rare earth hydrogen storage materials.
In the downstream application field of rare earths, NdFeB permanent magnets have the fastest growth rate, and compared with sintered NdFeB, bonded NdFeB has the advantages of not being easy to corrode and less difficult to produce, but the magnetic properties are relatively poor. High-performance NdFeB has a wide range of applications in the fields of automobiles, wind power and inverter air conditioning, and the market demand is growing rapidly.
Rare earth competition pattern and leading carding
The global supply of rare earths is highly concentrated. According to the latest data from the United States Geological Survey (USGS) in 2022, China accounts for up to 70% of rare earth production, dominating the global market.
In 2022, the mainland's rare earth production reached 210,000 tons of REO, ranking first in the world. Overseas rare earth production is mainly concentrated in the United States, Australia and Myanmar, which together account for about 4%, while other countries together account for about 5.7% of rare earth production.
Looking back on the development of China's rare earth industry, since 2011, the first round of rare earth resource integration has been opened; At the end of 2015, the six major groups of Chinalco, Xiamen Tungsten, Northern Rare Earth, China Minmetals, Guangdong Rare Earth and Southern Rare Earth basically completed the integration; The establishment of China Rare Earth Group in 2021 further marks the continuous optimization of the industry structure.
At present, the mining and smelting of rare earths are subject to a quota system, which makes the supply have rigid characteristics, thus forming a substantial hard constraint on supply. As the country's emphasis on the strategic value of rare earths continues to increase, it is expected that this supply constraint will only increase.
At present, the domestic rare earth quota is mainly concentrated in the hands of two enterprises, North Rare Earth and China Rare Earth Group. From the perspective of the structure of rare earth resources, it is still mainly biased towards light rare earths, and the new output is mainly concentrated in the northern rare earths. #财经 ##长文创作激励计划#
The layout of the rare earth industry chain of Northern Rare Earth, Shenghe Resources, China Rare Earth, Guangsheng Nonferrous Metals, and Xiamen Tungsten Industry:
Source: Xingxingcha
epilogue
In the medium to long term, the supply-side performance of rare earths is even expected to outperform lithium and cobalt, and their ability to navigate economic cycles in the future may be stronger. Rare earth downstream permanent magnet materials are in strong demand in many emerging fields such as new energy vehicles, wind power and intelligent robots. With the support of a new round of policies, the whole industry chain is expected to usher in a new round of development opportunities!
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