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Rare Earth Metals Prices Hit New Lows, Nearing Pre-Pandemic Levels
Rare earth metals prices have plummeted to new lows recently, with some components experiencing drops not seen since September 2020. The Rare Earths MMI (Monthly Metals Index) fell by 5.08% overall, with neodymium oxide and praseodymium oxide witnessing the sharpest declines. This marks the sixth consecutive month of price drops, but experts believe that the index may have finally hit rock bottom.
According to a recent S&P Global article, rare earth metals prices have seen a significant year-over-year decline. Lynas Rare Earths, a major producer, reported a 32% drop in the average selling price for neodymium-praseodymium to AUS $35.50 per kilogram for the July-December 2023 period.
Terbium oxide and neodymium oxide prices hit their lowest levels since late 2020 in March 2024, according to oilprice.com. MetalMiner’s MMI index also reflected this trend, with commercial rare earth elements nearing pre-pandemic price lows.
Despite some cost support at current price levels, analysts are finding it challenging to predict a durable price recovery. A recent decline in sales and earnings for Lynas Rare Earths in Q1 2024 adds to the uncertainty surrounding the market.
The abundance of rare earth metals globally, coupled with decreased demand for items that rely on these elements, continues to put downward pressure on prices. Additionally, trade disputes and geopolitical tensions, particularly between major rare earth producers like China and the U.S., are impacting market dynamics.
Looking ahead, challenges in the sector remain, particularly surrounding the potential to replace rare earth elements with alternative materials and the advancement of new technologies. The industry may need to adapt to these changes in order to support the recovery of rare earth metal prices in the future.
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