Rapidly increasing consumer demand for neodymium-iron-boron (NdFeB) magnets is expected to continue to prompt China's rare earth producers to expand their output capacity, according to market participants.
Continued output growth from the humanoid robot and new electric vehicle (NEV) industries will further boost consumption of rare earth permanent materials in the coming years. A humanoid robot typically needs more than 40 units of servo motors, taking total demand for NdFeB magnetic materials up to 2-4kg for one robot. Global output of humanoid robots is projected to reach 890,000 units by 2030, up from around 50,000-100,000 units in 2026, said some market participants, adding that the steep rise in humanoid robot output may boost NdFeB magnet demand to around 3,200t in 2030, sharply up from below 35t currently.
Sustained development in the NEV market, especially from China, will also lend support to NdFeB demand and encourage capacity expansion. China produced 4.429mn NEVs in January-April, up by 48pc from a year earlier, according to data from the China Association of Automobile Manufacturers (CAAM). Sales increased by 46pc to 4.3mn in the same period.
Global demand for rare earth magnetic materials from the NEV industry is forecast to rise by over 10pc on the year to more than 60,000t in 2025, and China's share in the NEV market is expected to rise to over 70pc in 2025 from 64pc in 2023 on the back of government policy incentives and subsidies, some market participants said.
Expansion plans
The robust consumer demand has encouraged rare earth producers in China to expand their output capacity for NdFeB magnetic materials in recent years.
Inner Mongolia NRE Magnetic Materials, a subsidiary of major light rare earths producer Northern Rare Earth (NRE), started constructing a production project for high-performance NdFeB fast-setting alloys in late April. It will reach an output capacity of 50,000 t/yr for magnetic materials alloys and 10,000 t/yr for hydrogen crushing after completion, making it the country's largest single NdFeB plant with comprehensive cost-effectiveness, high-quality products and strong market competitiveness, the firm said in May. Details including construction schedule and launch dates have not been disclosed.
NRE in October 2024 invested 40mn yuan ($5.56mn) to form a joint venture (JV) called Northern Zhaobao Magnet (Inner Mongolia) to launch a NdFeB permanent magnet production line with an output capacity of 3,000 t/yr. The JV was formed with magnet manufacturers Ningbo Zhaobao Magnet and Ningbo Souwest Magnet, as well as equipment producer Suzhou Torin Drive.
NRE also jointly formed Advanced Northern Technology with Chinese magnet producer Advanced Technology Materials and NRE Magnetic Materials in 2023. The project is based in Inner Mongolia's Baotou city and has a NdFeB magnet plant with an output capacity of 5,000 t/yr of NdFeB magnets.
NRE started operations at the first phase of a rare earth smelting plant at its wholly-owned subsidiary Baotou Huamei in October 2024. The Baotou-based project has an extraction and separation capacity of 106,661 t/yr of rare earth oxide (REO), as well as processing capacity of 198,000 t/yr for mixed rare earth concentrate that is equivalent to 115,018 t/yr of 58.09pc REO, precipitation and crystallisation capacity of 141,070 t/yr REO and burning capacity of 39,600 t/yr REO. This will make NRE the world's largest rare earth feedstock production base. NRE will start construction of the second phase in the second half of 2025.
Baogang Xinli Rare Earth, NRE's holding subsidiary based in Xinfeng county of Jiangxi's Ganzhou city, expanded its recycling capacity to 4,960 t/yr for NdFeB scraps in 2024. NRE's other subsidiary Baotou Jinmeng Rare Earth is also upgrading its 3,000 t/yr rare earth concentrate smelting and separating production line and constructing a 4,000 t/yr NdFeB scrap project. NRE has signed long-term contracts with downstream magnet plants since 2022 to procure NdFeB scraps for resource recycling utilisation based on market prices.
NRE has developed a complete circulation system from rare earth ore to metal, magnetic material and NdFeB scraps.
NRE posted its revenue at Yn9.28bn over January-March, up by 61pc on the year. Its net profits rose to Yn431mn in the first quarter of 2025, surging from Yn52mn a year earlier. The firm attributed the rises to higher prices for praseodymium-neodymium products, owing to ore feedstock supply shortages and higher consumer demand. NRE expects its revenue and profits to reach around Yn37.2bn and around Yn2.8bn respectively in 2025.
Argus-assessed domestic prices for 99pc praseodymium-neodymium metal averaged at around Yn528/kg ex-works in January-March, up by 11pc from Yn475/kg over the same period in 2024.
