Reduced Myanmar supply 'to drive rare-earth prices higher'

As November kicks off, the rare-earth market is back in the spotlight due to supply disruptions from Myanmar, with analysts noting on Sunday that a sustained rise in prices is expected.

After seeing elevated list prices for rare earths in September and October, some Chinese suppliers have increased their prices for three months in a row.

For instance, Inner Mongolia Baotou Steel Rare-Earth announced its list prices for rare earths for November on Friday, revealing a slight month-on-month increase in the prices of several products, such as praseodymium neodymium oxide, often abbreviated as PrNdO.

Myanmar accounts for more than 50 percent of the global heavy rare-earth supply, and given the current situation in Myanmar, the rare-earth market prices are likely to experience a sustained increase, Wu Chenhui, an independent industry analyst who closely follows the industry, told the Global Times on Sunday.

Myanmar mainly produces medium and heavy rare-earth ion ores, accounting for 11 percent of global output in 2023.

From January to September, China imported 31,000 tons of rare-earth oxides from Myanmar, which constituted 74.9 percent of total oxide imports during that period, according to the General Administration of Customs.

The suspension of mining operations in Myanmar, along with environmental restrictions on the domestic supply of medium and heavy rare earths, could lead to a shortage in the supply of these materials, a research report released by Huatai Securities said.

In the next two to three years, the supply landscape for rare earths is not expected to change significantly, with China continuing to account for more than 60 percent of global supply. Meanwhile, prices are likely to steadily rise into a more sustainable range, Wu added.

Multiple related stocks in the A-share market, including Inner Mongolia Baotou Steel Rare-Earth and China Rare Earth Resources and Technology Co, hit their daily limits on Friday, while rare-earth stocks in the Hong Kong market also experienced a rally.