Rare Earth Magnets: Price Surge & China Supply Shift
- New restrictions by Beijing on rare earth magnet exports are reshaping the global market.
- Suleman's company,Neo Performance Materials,began production at its Estonia plant in May.
- NovaTech, a magnet producer in China, is investing at least 10 billion won ($7.39 million) in a Vietnam plant, according to a company source.
China’s tightening grip on rare earth magnet exports is sending shockwaves through the global market. demand for these crucial components,vital for electric vehicles and wind turbines,is surging outside of China. Companies are scrambling, willing to pay hefty premiums-up to 30% more-for rare earth magnets from option sources. News Directory 3 reports on how new plants in Europe and Asia are racing to meet the booming need. Key players are investing millions to capitalize on this shift, yet expanding magnet production outside of China is a complex, years-long endeavor. Discover what’s next …
Rare Earth Magnet Demand Surges Amid China export Controls
Updated July 1, 2025
New restrictions by Beijing on rare earth magnet exports are reshaping the global market. Rahim Suleman of Neo Performance Materials said that since April 4, inquiries for magnets have increased dramatically. The magnets are crucial for electric vehicles and wind turbines.
Suleman’s company,Neo Performance Materials,began production at its Estonia plant in May. He said customers are willing to pay a premium of $10 to $30 per kilogram for magnets from his facility, compared to Chinese magnets.Electric vehicles typically use 2 to 4 kilograms of magnets.
NovaTech, a magnet producer in China, is investing at least 10 billion won ($7.39 million) in a Vietnam plant, according to a company source. The plant is scheduled to open early next year. Customers are prepared to pay 15% to 20% more for magnets made in Vietnam, the source said.
Grant smith, chairman of Britain’s Less Common Metals, said his company is struggling to handle the surge in inquiries. the firm is planning to expand into France and other countries.
Despite the increased willingness to pay more, industry participants note that it will take years to significantly increase production outside of China, which currently accounts for 90% of global permanent magnet supply.
An executive at a rare earths company said automakers are prepared to pay $80 per kilogram for neodymium-praseodymium oxide (NdPr), a rare earth needed for magnets. This is nearly a 30% premium over the Chinese price of $62, based on data from Fastmarkets.
Project Blue, a critical minerals consultancy, estimates that a price of $75 to $105 per kilogram for NdPr is needed to support sufficient production to meet demand. Barrenjoey, an Australian company, suggests prices need to be $120 to $180 per kilogram to fund a substantial wave of production.
What’s next
The industry will continue to balance the need for secure, non-China supplies of rare earth magnets with the cost pressures of electric vehicle production. Further expansion of rare earth production outside China is expected.