Global rare earths short-term outlook January 2024

Sustained economic uncertainty, particularly within China, is denting consumer confidence and spending. This has restricted procurement activity from magnet manufacturers. The Spring Festival in China could provide some short term stimulus for downstream purchasing activity, though we don’t expect any significant improvements until later this year. Prices for all key magnet rare earths suffered significant declines in January, falling between 9.8% and 18.2% month-on-month. Global supply continues to develop in order to keep pace with rising demand from magnet applications. Mined supply growth will be driven by expansions at existing operations in China, which were boosted by an additional third batch of production quotas at the end of 2023, and the development of new supply outside of China. Global refined supply is set to rise at a CAGR of 6.1% to 2028, reaching 300.7 kt REO. However, inflationary pressures and other developmental challenges could delay project development.