Location:Home > News

Prospects for the development of the rare earth permanent magnet industry chain in 2017

release time:2017/04/26

Business News February 06

   In 2016, despite the complicated global economic environment, China's national economy still achieved a good start to the "13th Five-Year Plan". According to preliminary calculations, the gross domestic product for 2016 was 744127 trillion yuan, an increase of 6.7% over the previous year at comparable prices.

   Although the rare earth permanent magnet industry chain has encountered a downturn in the market, its development has not fallen into a low ebb. With the help of policy and supervision guidelines, the industry has cultivated self-discipline, reformed and upgraded and developed; in the context of the economic requirements of energy conservation and environmental protection, the industry has delivered a beautiful report card.

  The policy and supervision upgrade system is implemented one by one

Continue to strictly implement the management standards for total production volume control of rare earth products; formulate "Regulations for the Rare Earth Industry (2016 Version)" and "Administrative Measures for Announcement of Regulations and Conditions for the Rare Earth Industry", which will be implemented on July 1, 2016; September 29, 2016 On the same day, the development plan for the rare earth industry (2016-2020) was issued; from December 2016 to April 2017, according to the three stages of local self-inspection, special inspection, and notification handling, the Ministry of Industry and Information Technology and eight ministries and commissions organized the crackdown on rare earth violations Act a new round of special actions.

   Six major groups integrated to achieve the planned goal

As of the end of December 2016, the six major groups (China Minmetals Corporation, Aluminum Corporation of China, Baotou Iron and Steel (Group) Co., Ltd. (North Rare Earth Group), Xiamen Tungsten Co., Ltd., Ganzhou Rare Earth Group Co., Ltd. (South Rare Earth The establishment of the Group) and Guangdong Rare Earth Industry Group Co., Ltd. and related materials have all passed the review and acceptance of the expert group.

   Previously, from the second half of 2014 to May 2015, the integration and reorganization plans of the six major rare earth groups were successively passed and approved by relevant departments for filing.

   Rare earth "13th Five-Year" development plan released

In order to scientifically guide the development of the rare earth industry and promote the overall development of the rare earth industry into the mid-to-high end, the Ministry of Industry and Information Technology issued the "Rare Earth Industry Development Plan (2016-2020)" in October 2016. The planned development goal is to achieve reasonable development and orderly development by 2020. With the new pattern of production, efficient utilization, technological innovation, and coordinated development of the rare earth industry, the industry as a whole has entered a development stage dominated by mid-to-high-end applications and high added value, giving full play to the strategic value of rare earth applications.

   Raw material prices are weak and fluctuate relatively stable

   In the whole year of 2016, the price of rare earth materials fluctuated weakly, but stabilized in the weak and relatively stable, and the oscillation amplitude was the lowest in recent years. Take praseodymium and neodymium metal as an example, the average price in January 2016 was 337,000 yuan/ton, and the average price in December 2016 was 332,000 yuan/ton; the lowest price was 316,000 yuan/ton in October, with little change.

  NdFeB industry chain sharing economic development

   Data from the National Bureau of Statistics show that in 2016, the added value of industries above designated size nationwide increased by 6.0% over the previous year, and the added value of high-tech industries increased by 10.8% over the previous year, exceeding market expectations. Similarly, the development of upstream, midstream and downstream companies in the NdFeB industry chain also performed well in 2016.

It is understood that the sales of major rare earth metal manufacturers have increased by more than 10%, and the sales of major ferroboron manufacturers are good but the profits of some companies are not as good as expected; the production and sales of most high-performance NdFeB companies have shown growth, and the main increase range is from 10- 20%, a small number of companies have a small increase, and some companies have increased by more than 50%; the increase of low-performance products is average; from the 2016 performance forecast of NdFeB listed companies, the net profit has maintained a good increase. Downstream energy conservation, environmental protection, high-tech fields and other major industries (new energy) automotive, wind power, smart phones, robots, sensors, etc., have maintained good growth in application demand.

Competition in the industry is fierce, and new high-performance product production capacity is successively launched to participate in market competition; price competition occasionally becomes a weapon to win business opportunities; multiple regions may consolidate or cultivate rare earth permanent magnet NdFeB industrial bases to enhance competitiveness; some companies seek And implement investment opportunities to extend the industrial chain.

   Innovative technologies including rare earth environmental protection smelting and new rare earth functional materials have emerged one after another. The production and processing technology and product quality of many NdFeB enterprises have been effectively improved, and the gap between the production technology capacity of high-end products and the international high level has been further shortened. In addition, in 2016, many companies in the midstream successfully listed on the New Third Board.

   Rare earth (permanent magnet) exports increase in volume and prices fall

According to the analysis of customs statistics, China's rare earth exports in 2016 were 46,749 tons, a year-on-year increase of 34.2%, an increase far exceeding 2015's 25.4%; the average export price dropped to 7.31 US dollars/kg, a year-on-year decline of 33.9%, and the decline was significantly greater than in 2015 .

   In 2016, China exported 26,900 tons of rare earth permanent magnets, a year-on-year increase of 15.5%, a significant increase over the previous year; the average export price of rare earth permanent magnets was US$47.3/kg, down 15.2% year-on-year, an increase from 2015.

   Prospects of the rare earth permanent magnet industry chain in 2017

   1. The market is expected to pick up

   As of the end of 2016, the negative impact of the abolition of export tariffs and tariffs on the market has been digested, and the market has also undergone another test and rebounded. The promotion of the integration of the six major rare earth groups, the launch of the third joint crackdown by eight ministries and commissions, the maturity of the rare earth stock exchange and the successful launch of China's rare earth price series index are all conducive to a more reasonable supply side. Therefore, the rare earth market in 2017 is expected to pick up.

   In addition, rare earth smelting projects in Australia and other countries will be gradually put into production, and appropriate price support will also be required before full volume increase. Based on the analysis of China's import of rare earth products in 2016, prices in Southeast Asia may have a certain advantage for the time being, but the current volume is still not large, and its advantages may not be sustainable.

  2. Key areas of policy supervision

   Rare earth is a rare strategic resource, and rare earth functional materials are classified as a series of new materials. In 2017, policies such as supervision and assistance will continue to be implemented in many aspects. Put an end to the phenomenon of resource predatory mining, and emphasize energy conservation and environmental protection in all production links; participate in the formulation of industry international standards, guide the development of industry standards; implement multiple systems such as traceability, and continue to eliminate the stubborn diseases of black rare earths, private mining and illegal mining ; Reward for practical innovative technologies to improve the awareness of intellectual property rights and protection; in addition, focus on supporting the work of resolutely eliminating outdated production capacity, researching and promoting the application of high-abundance rare earth elements, and the final improvement of the integration of the six major groups.

  3. Hengqiang, a strong player in industry reshuffle

Large and medium-sized enterprises have sufficient production capacity to obtain a larger market share. Enterprises with relatively complete industrial chains have obvious cost advantages. Local financial subsidies and rewards have improved the competitive advantages of local enterprises. The improvement of consumption power will inevitably put a higher value on products. Quality and performance requirements. These factors will promote the reshuffle of the industry. As a result, the strong will remain strong and the fittest will survive the survival of the fittest. The market share of low- and mid-end products will inevitably decline or even disappear.

   4. Application demand continues to improve

   The top-level design indicates that reform-there is no turning back when construction starts. The “Thirteenth Five-Year Plan” for various industries guided by the government has been released one after another, with core content centered on innovation, energy conservation and environmental protection, intelligence, big data and the Internet. As a key element to realize energy saving, environmental protection and high technology, rare earth and its functional materials are widely used in such hardware facilities.

Rare earth permanent magnet neodymium iron boron materials, rare earth additives, rare earth polishing materials, rare earth luminescent materials, rare earth hydrogen storage materials are used in electro-acoustic motors, rare earth alloys, rare earth catalysts, polishing powder (liquid), energy-saving lighting and laser, battery applications, and even It will be indispensable in realizing high-speed data storage and transmission, as well as its strong magnetic properties for guiding and fixing applications. Therefore, the industry frontier believes that we have enough reasons to support its continued good application demand.

   "No pie in the sky, roll up your sleeves and work hard!" , The "13th Five-Year Plan" is also the guiding light and direction for the development of various industries. In 2017, the transformation and upgrading, reform and development of China's rare earth permanent magnet industry has also entered a critical stage. Develop an energy-saving and environmentally friendly rare earth industry economy, develop high-quality in innovation, and actively innovate in development.

More importantly, it is to consolidate and strengthen China's international status as a major rare earth country, transform the supply advantages of rare earths and their functional materials into industry-leading advantages, lead the formulation of industrial rules in the era of peaceful development, and take the initiative to assume the role of an open and inclusive major country, thereby leading the world Market development direction.

   (Source: Industry Frontier)