Rare earth prices hit two-year peak after MP Materials stops China shipments26 Aug 2025 15:17
LONDON/BEIJING (Reuters) -Prices of two rare earth elements needed for super-strong magnets have surged to their highest in more than two years after U.S. miner MP Materials (MP) stopped raw material exports to leading magnet maker China amid rising demand.
MP's shipments had in the past three years fed 7%-9% of China's oxide production from mine output of rare earths neodymium and praseodymium (NdPr) - vital to magnets that power electric vehicles, wind turbines and defence equipment - consultancy Adamas said.
"MP's shipments were a very material portion of NdPr oxide supply for China's factories, so that's left a big void," said Ryan Castilloux, managing director of Adamas.
MP had paused shipments to China in April due to high tariffs, but any shortage was masked by weakness in magnet demand due to Chinese export curbs, analysts said. U.S. rare earth ore supply to China slid in May and hit zero in June before jumping last month, probably due to the final MP shipments, they added.
China's exports of rare earth magnets recovered to hit a six-month high in July after Beijing eased its export controls, having agreed a series of deals with the U.S. and Europe.
"China is currently in its peak manufacturing season for electric vehicles, wind turbines, and consumer electronics. This cyclical uptick in demand has put additional pressure on available NdPr supply," said Neha Mukherjee, research manager for rare earths at consultancy Benchmark Mineral Intelligence.
Support has also come from uncertainty surrounding Chinese rare earth mining and smelting quotas, which were released this year without the typical public statement.
Castilloux said some players may be anticipating lower quotas, adding that he expects a modest 5% increase in Chinese output this year, in contrast to demand growing at about 10%.
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