SunSirs: Sep 27

1. Trend of Rare Earth Market

Some prices of domestic rare earth decline this week. On Sep 27, the weekend price of Praseodymium-Neodymium Oxide is 317,500RMB/t, decreasing 1.55% and 1.55% year on year; The reference quotation of Dysprosium Ferroalloy Alloy is 1,865,000 RMB/t, decreasing 1.32% but increasing 59.06% year on year; The reference quotation of Praseodymium-Neodymium Alloy is 407,500RMB/t, decreasing 1.21% and 1.21% year on year; The main reference quotation of Praseodymium Oxide is 382,500RMB/t, it is stable and decreases 6.71% year on year; The main reference quotation of Dysprosium Oxide is 1,865,000RMB/t, decreasing 1.32% but increasing 63.32% year on year; The reference quotation of Neodymium Oxide is 319,500RMB/t, decreasing 1.54% but increasing 0.95% year on year; The reference quotation of Neodymium Metal is 407,500RMB/t, decreasing 1.21%, remains the same year on year; The reference quotation of Praseodymium Metal is 695,000RMB/t, it is stable and increases 5.30% year on year; The main reference quotation of Dysprosium Metal is 2,325,000RMB/t, it is stable and increases 43.08% year on year.

2. Rare Earth Commodity Index

On Sep 27, the Rare Earth Commodity Index is 375, 1 point lower than that of Sep 26, 62.50% lower than the peak of 1,000 in the cycle (Dec 6, 2011), and 38.38% higher than the lowest point of 271 (Sep 13, 2015). (Cycle: Dec 1, 2011 to date)

3. Market Analysis

Recently, some prices in the Rare Earth Market have decreased, the trading of the domestic Market has been general. The prices of Dysprosium Terbium Metal and Dysprosium Terbium Oxide have decreased, the inquiries for Praseodymium Neodymium Oxide have been decreased, the price of light Rare-Earth Oxide has declined slightly. The light Rare-Earth merchants are less likely to sell, the recent trading situation has been general. The supply of domestic Rare Earth is normal, the price fluctuation is related to the national environmental protection supervision. Rare earth’s production has particularity, especially the radiation hazard of some products, which makes environmental protection supervision more stringent. Metal enterprises and downstream magnetic materials enterprises have strong wait-and-see sentiment because there is still room for pre-holiday purchases and the mood to buy after holiday is weak, and rare earth prices have declined compared with the previous period. Under this circumstance, Rare Earth separation enterprises in several provinces have stopped their production, which has led to the general market volume of Rare-Earth Oxide, especially some mainstream ones, thus the price has a stable trend. Recently, the large enterprises have been reluctant to sell, the Rare-Earth Market has been general, and the turnover has not changed a lot.

The National Environmental Protection Department has not reduced its stringent efforts, which has a great impact on the Rare Earth industry, the operating rate has been low, the market has been cold, and there has been regulations of Rare-Earth industry in Jiangxi, a large province of Rare-Earth producing, all of which are good news to the Market. Recently, the Supervisory Group of the State Council has gone to Jiangxi Rare Earth enterprises. This inspection closely centered on the major deployment of the Central Committee of the Communist of China and the State Council, highlighted the key and difficult issues in the field of economic operation and reform and development, and focused on the strong blockades and pain points reflected by the people and the market subjects, so as to promote the implementation of various tasks from point to area. Besides, the NDRC and departments concerned have promoted effective measures urgently，strengthen the consolidation and made the related management mechanisms innovate and improved, in order to accelerate the construction of a development pattern which consists of a rational industrial structure, an advanced scientific and technological level, the effective resources protection and the orderly production and operation and to add the special value of Rare Earth as a strategic resource. The supply of raw ore resources in the upstream of the Rare Earth industry has shrunk, and people in the domestic market are waiting for the good news on policies and State Reserve.

4. Prospect for the Future

Rare Earth analyst from SunSirs expects that some prices of Rare Earth may remain at low. Although the supply may stay at low as well, caused by the strict environmental protection inspection and the regulation of the industry, the downstream demand is still not good.

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