Rare earth prices hit two-year high after MP material halts China exports

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Prices of two key rare earths used in high-strength magnets have jumped to the highest point in 2 years after US-based miner MP Materials halted exports of raw materials to China, the world’s top magnet maker. The move tightened supplies amid rising demand, lifting prices. China controls most of the rare earth supply chain, with about 90% of the refining capacity and roughly 70% of the mining output. Washington has tried to shift that balance. In July, the U.S. signed a deal with MP Materials, its largest producer, to process the company’s output at home rather than send it abroad. For the past 3 years, MP’s shipments supplied an estimated 7%-9% of China’s NdPr oxide production, according to consultancy Adamas. Neodymium-Praseodymium (NdPr) is essential for magnets used in electric cars, military gear, and wind turbines. “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 from Adamas. Rare earth NdPr prices climbed in July Benchmark Chinese prices for NdPr oxide have climbed to 632,000 yuan per metric ton, or about $88 per kg, up from $63 in July. The roughly 40% rise, after a long stretch of weakness, is improving the outlook for mine projects outside China as Western nations look to cut reliance on Beijing. The push to lift output in the U.S. and Europe gained urgency after China tightened exports in April during a wider trade dispute, a move that forced some auto plants to shut. Last month, the U.S. government finalized a deal with MP that requires the company to stop shipping to China. The agreement also includes price support for MP’s NdPr at a reference of $110 per kg, about twice China’s price at that time. MP had already paused exports to China…