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About recent magnetic material price reason

• 2021-01-20

Recently, we have received same questions from downstream customers about the price increase of magnetic materials that some of them have puzzles and doubts about the problem. Therefore, we have made the following explanation with several main objective factors .

From October, 2020.China’s magnetic material industry has been affected by the international market, and the prices of bulk commodities have soared, especially the prices of rare earth, non-ferrous metals, iron ore, strontium ore and other raw materials. In addition, the multiple factors such as the domestic environmental protection concepts, cut or stop production of international iron and steel enterprises which have caused the price of magnetic materials have rocketed, and the supply is very tight.
For example, iron oxide has doubled from 2,000 CNY / ton in late last year to 4,000 CNY / ton, and in short supply now; FE-P has increased by 50% from 1,000 CNY / ton at the end of last year to 1,500 CNY / ton now; strontium carbonate has increased by 40% from 5,000 CNY/ ton to 7,000 CNY / ton now; cobalt oxide has increased by 12% from 190,000 CNY / ton to 230,000 CNY / ton, and the price of Pr Nd has also risen more than 50% . Judging from the development situation, the prices of these raw materials are still rising and stay high. The above mentioned materials are the main raw materials of magnetic products, accounting for more than 30% of the product cost, and permanent magnet products are even higher. The rising of raw materials cost from upstream will inevitably push up the price of magnetic materials. It is conservatively expected that the price will be pushed up by more than 10%, even higher. It is difficult for the industry itself to digest the rising cost of raw material prices, which needs to be absorbed in every link of the industrial chain.

China’s magnetic material industry has been very mature, product costs are transparent, technology and equipment of production factors have been finalized, so the profit is small, besides, the ability to self-digest the cost of raw materials is very limited, hope customers in the industry chain need to give understanding and sympathy. Of course, for the industry and enterprises, they should also dig deeper and make some sacrifices which through fine management and the development of new processes, new technologies, and new products to digest some of the rising cost pressure of raw materials. At the same time, everyone should communicate actively, do a good job in explaining it to the clients and obtain the understanding and support, and form a consensus on overall response to the unfavorable situation caused by the increase in raw material prices, and jointly maintain the smoothly and healthy development of China’s manufacturing industry.