Rare earth prices loosen "very small" difficult to resolve

Since the six ministries and commissions jointly announced the rare earth industry integration action on August 8, the average decline in the prices of various types of rare earth products has exceeded 20%. According to industry insiders, this fall will continue into September and is expected to fall by 20%-25% again.

Zhang Anwen, deputy secretary-general of the China Rare Earths Association, said that rare earth prices will not return to the highs in the first half of the year. The profits of rare earth companies, especially middlemen, should return to a reasonable level.

According to report, the Ministry of Industry and Information Technology has announced that six ministries and commissions including the Ministry of Industry and Information Technology, the Ministry of Land and Infrastructure, and the National Development and Reform Commission jointly issued the "Circular on the Implementation of a Specific Rectification of the National Rare Earth Production Order" and decided to carry out the rare earth from August 1 to December 31, 2011. Production order special rectification actions. Rare-earth mines and smelting and separation enterprises have no plan, over-planned production, acquisition and sales of illegally-mined rare earth mineral products and other violations of laws and regulations to investigate and prosecute, maintain normal production and circulation order, and promote the sustainable and healthy development of rare earth industries.

The price of rare earth dropped for the first time this year but the margin was “very small”

Starting from October 2010, a rare wave of price increases began to appear in the Chinese rare earth market. The price of rare earth materials and rare earth metals soared, and in April 2011, it exploded into explosive growth. For example, the current price of antimony oxide is about 1.48 million yuan/ton, and the annual increase rate is 628.4%, while the lowest price in 2010 is only 118,000 yuan/ton.

Yesterday, the reporter investigated the current rare earth price discovery, still using cerium oxide as an example, the price on August 15 was 1380000-1430000 yuan/ton, but on July 29, the price of thorium oxide was 1.50000-1.550,000 yuan/ton; In terms of raw materials, the price of metal osmium on August 15 was 1750000-1.80000 yuan/ton, and on July 29 the price of metal oysters was 1790000-1800000 yuan/ton.

From the beginning of this year to July, the price of rare earths has been on an upward trend. Until late July, rare earth prices have shown signs of a slight decline, prices have fallen by about 20%, and the price of rare earths has apparently become loose. This price reduction is even more “very small” compared to the previous 2-3 times or even higher increase.

The chairman of the China Rare Earth Society, Gan Yong, pointed out that there are still some factors that will directly affect the price of rare earths in the second half of 2011. Compared to rapid domestic demand, domestic supply is still relatively tight, so that rare earth prices will remain high. run.

At the end of July and early August, the industry rumors that most of the rare earth companies have used a complete annual production directive plan. In previous years, the super production order plan was the norm, and the plans formulated by the government often became a dead letter. The rectification will undoubtedly focus on ultra-planned production and is determined to rectify the unspoken rules of the industry. Industry insiders estimate that this means that a large number of companies will stop production in the second half of the year.

At the same time, the rectification operation will also focus on cracking down on rare earth industry phenomenon. The notice stated that rare earth mineral products trading should be limited to rare earth mines and smelting and separation enterprises that have mandatory production plans, and those rare earth distribution enterprises that procure illegal or unregulated production plans for rare earth mineral products and smelting and separating products will be punished.

In the first half of this year, the price of rare earths went up all the way, and many rare earth traders took the opportunity to stockpile goods, causing the rare earth price to soar three times, once reaching a situation where there was no market for prices, and even downstream companies could not afford to stop production.

Downstream companies have measures to deal with the high price of rare earths

Industry sources pointed out that in the context of long-term rare earth price continues to rise, the new energy industry more sensitive to rare earth prices need to take timely response measures to adapt to the fact that high-level rare earth has become the norm.

It is understood that at present, individual listed companies have already taken corresponding measures. Goldwind Technologies purchases permanent magnetic materials from a number of suppliers as countermeasures, including Jiangxi Jinli, which holds 30% of the company's shares, and the latter is specialized. Permanent magnet materials processing companies. “The annual fixed-price supply contract signed between Goldwind and Jiangxi Jinli has enabled the company to partially offset the increase in the cost of permanent magnet materials in the spot market. Some small-scale adopters of direct-drive technology have simply pushed back and stepped up. Feed technology model.

Zhonghua analyst Chen Hua pointed out that a 1.5MW permanent magnet direct-drive generator requires approximately 1 ton of permanent magnet material. At the beginning of this year, the price of permanent magnetic materials was around RMB 100/kg, and by July this year, the price of permanent magnetic materials had soared to RMB 700/kg. This means that the cost of a 1.5MW permanent magnet direct-drive generator has increased by 600,000 yuan. “If all purchases are made in the spot market, the gross profit margin of permanent-magnet direct-drive blowers such as Goldwind will be reduced by about 10%. This is undoubtedly a nightmare for Goldwind and other companies.” The reporter learned that some small and medium-sized vehicles use direct-drive. The companies on the route are affected by the sharp increase in rare earth prices. Since the middle of the year, they have already cut production significantly or even stopped production.

In addition, in order to deal with the price increase of rare earth materials, some energy-saving lamp companies use less than one-half the cost of three-color fluorescent powder halogen powder energy-saving lamps instead. However, although the halogen powder lamp is also an energy-saving product compared to the incandescent lamp, the efficacy and lifespan of the energy-saving lamp than the three-color phosphor are greatly reduced. This also makes many traditional energy-saving lamp companies, began to fully transform LED lighting.

Chairman Wu Xichang of NVC Lighting stated that although LED lighting products also use rare earth phosphors, their consumption is less than that of energy-saving lamps. Moreover, the continuous price reduction of chips has far outweighed the price increase of phosphors. Increased cost pressures. Rising rare earth price is an opportunity for the development of LED. It is reported that NVC lighting energy-saving lamps currently account for 70% of sales, will accelerate the adjustment of its product line in the future, this year, LED lighting product revenue will account for NVC's total revenue will increase from 2% last year to 5%, within the next five years, LED The revenue from lighting products will account for 50% of the company's total revenue.