The related transaction prices of rare earth concentrates between Baosteel Group (600010. SH) and Northern Rare Earth (600111. SH) were announced in the first quarter of 2024. This price adjustment continues the trend of a slight increase in rare earth concentrate transaction prices in the fourth quarter of last year.
Tonight, Baosteel Group and Northern Rare Earth announced that according to the calculation formula and the market price of rare earth oxides in the fourth quarter of 2023, both parties plan to adjust the related party transaction price of rare earth concentrate in the first quarter of 2024 to 20737 yuan/ton (dry volume, REO=50%) without tax, with a 1% increase or decrease in REO and a 414.74 yuan/ton increase or decrease in the price without tax.
Based on this calculation, the trading price of rare earth concentrate in the first quarter of 2024 increased by 201 yuan/ton compared to the fourth quarter of 2023, with a month on month increase of 0.98%; Compared to the same period last year, it decreased by 14576 yuan/ton, a year-on-year decrease of 41.79%.
Most industry insiders have expressed "incomprehension" about the recent increase in rare earth concentrate trading prices: since the fourth quarter of last year, the price of praseodymium neodymium oxide has been continuously decreasing, and it is now almost falling to the cost line. At this time, the rise in rare earth concentrate trading prices is unreasonable.
However, industry analysts told Caixin News that "Baosteel Group's recent increase in rare earth concentrate trading prices is likely to pave the way for a subsequent increase in the price of praseodymium neodymium oxide; another major role of raising rare earth concentrate trading prices may be to boost market confidence."
In the first three quarters of 2023, due to the downward trend in the price of praseodymium neodymium oxide, the price of rare earth concentrate has also been declining, with a month on month decline of 35% in the third quarter of last year. In the fourth quarter of 2023, the trading price of rare earth concentrates in northern China saw its first increase of the year, but the increase was only 1.78%, which was lower than market expectations.
According to data from the China Rare Earth Industry Association, as of January 9th, the rare earth price index was 179, a 21.7% decrease from the rare earth price index of 228.6 at the beginning of the fourth quarter of 2023 (October 7th); On October 7, 2023, the average market price of praseodymium neodymium oxide was 523000 yuan/ton. On January 9, the average market price of praseodymium neodymium oxide had dropped to 404000 yuan/ton, a decrease of 22.75%.
On January 2nd, Northern Rare Earth announced the listing prices of rare earth products for January 2024, and the prices of rare earth products have all decreased month on month. Specifically, lanthanum oxide was reported at 4100 yuan/ton, a decrease of 58.16% from the previous month; Cerium oxide was reported at 6500 yuan/ton, a decrease of 33.67% from the previous month; Praseodymium neodymium oxide was reported at 453300 yuan/ton, a decrease of 8.13% compared to the previous month; Neodymium oxide reported 461600 yuan/ton, a decrease of 7.99% from the previous month; Metal praseodymium neodymium reported 560000 yuan/ton, a decrease of 7.89% from the previous month; Neodymium metal reported 50000 yuan/ton, a decrease of 7.77% from the previous month.
The Caixin News Agency reporter also noticed that the prices of related transactions of rare earth concentrates in the first quarter of this year were released earlier than the same period last year. On March 14, 2023, Baosteel Group and Northern Rare Earth announced the trading prices of rare earth concentrates in the first quarter of last year. At the same time, both parties agree that starting from April 1, 2023, the agreed pricing formula will not