Rare earth concentrate prices rise for the seventh time, up 45% in Q2; rare earth sector surges

The price of China’s rare earth concentrate has increased for the seventh consecutive quarter, with the growth rate setting a new record since the current pricing mechanism was established, driving related rare earth stocks significantly higher.

Baotou Steel and Northern Rare Earth announced on April 10 that the transaction price for rare earth concentrate for related parties in the second quarter of 2026 is set at 38,804 yuan/ton (excluding tax, dry weight, REO=50%), up approximately 45% from the first quarter, refreshing both the price and growth records since the unified adjustment mechanism was established in April 2023.

Boosted by this, several rare earth sector stocks saw notable gains. Baotou Steel rose more than 8.5% intraday, Northern Rare Earth's gains reached as high as 3.1%, and China Rare Earth Resources Technology surged about 2.5%.

This price increase comes amid the ongoing evolution of the global rare earth supply chain. For the market, this quarterly pricing signal both reflects the current tightness on the supply side and suggests that profit expectations for related listed companies may be further revised upwards.

Both Price and Growth Hit Record Highs

According to the two companies’ announcements, the transaction price for rare earth concentrate in the second quarter is 38,804 yuan/ton, a quarter-on-quarter increase of 44.61%, both surpassing the previous highest—31,030 yuan/ton in the second quarter of 2023 and the corresponding growth rate at that time. This also marks the seventh consecutive quarter of price increases since the unified price adjustment mechanism was implemented on April 1, 2023.

Data compiled by the media based on company announcements show that this growth rate is also the largest single-quarter jump since the rare earth pricing mechanism reform in 2023.

Both companies calculate prices according to the established formula: for every 1% change in REO content, Baotou Steel’s tax-excluded price is adjusted by 766.08 yuan/ton, and Northern Rare Earth by 776.08 yuan/ton.

Pricing Mechanism and Supply Structure

The current pricing mechanism can be traced back to April 2023. Northern Rare Earth and its affiliate Baotou Steel signed an agreement that, starting from April 1, 2023, in the first ten days of each quarter, the rare earth concentrate price will be calculated and adjusted using a set formula based on the previous quarter’s rare earth oxide market price. Afterwards, new supply contracts or supplementary agreements are signed and disclosed.

In terms of supply structure, Baotou Steel disclosed that its Bayan Obo mine has rare earth reserves equivalent to about 35 million tons of oxide, accounting for 81% of domestic rare earth reserves. Northern Rare Earth is the sole purchaser of Baotou Steel’s rare earth concentrate products, and the transaction pricing between the two serves as a key reference for the domestic rare earth concentrate market.