Editor's Note: A review of the H1 rare earth market shows it was a case of "you reap what you sow." The rare earth sector drifted higher overall, with performance varying across products. Pr-Nd oxide gained 22.42% in H1, dysprosium oxide rose 5.97%, and terbium oxide gained 8.37%. With a rising tide lifting all boats, higher rare earth prices directly boosted operating earnings at companies along the industry chain. According to SMM, the 10 rare earth-related companies that have disclosed semi-annual reports, preliminary results, or earnings forecasts all achieved varying degrees of earnings growth in H1. The market is now awaiting demand to materialize in the traditional peak season. As summer gives way to autumn, can rare earth prices extend their H1 gains in H2, and what market conditions will upstream and downstream players in the rare earth industry chain face? Multiple Rare Earth Companies Report Positive H1 Results The H1 earnings forecast disclosed by Zhongxi Nonferrous Metals on the evening of July 13 showed that, based on preliminary estimates by the company's financial department, the company expects net profit attributable to shareholders of the listed company in H1 2026 to be RMB370 million to RMB430 million, an increase of RMB297.5013 million to RMB357.5013 million compared with the same period last year, up 410.35% to 493.11% YoY. The company also expects net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses in H1 2026 to be RMB368.0027 million to RMB428.0027 million, an increase of RMB276.2326 million to RMB336.2326 million compared with the same period last year, up 301.00% to 366.39% YoY. As for the main reasons for the expected earnings growth, Zhongxi Nonferrous Metals said: (1) In H1 2026, the supply-demand pattern of the rare earth industry changed and prices of major rare earth products rose YoY. By adopting an innovative integrated operating model to coordinate raw material procurement for rare earth separation plants and sales of all products, and by analyzing market supply-demand changes to dynamically adjust its product output mix, the company significantly increased the operating value of its core rare earth business. (2) The company made substantial progress in loss-making enterprise restructuring and deepened reform, with resources further concentrated in its core main business and competitive operations, and losses at loss-making enterprises narrowed significantly YoY. (3) Its associated company Dabaoshan Company maintained stable and high production; sales volumes and prices of copper and sulfur products both increased YoY, boosting Dabaoshan's profit, and the company's investment income recognized under the equity method increased accordingly. The H1 earnings forecast disclosed by Huahong Technology on the evening of July 13 showed that the company expects net profit attributable to the parent company in H1 2026 to be RMB320 million to RMB360 million, up 301.84%-352.08% YoY. Regarding the reasons for the performance change, Huahong Technology said: In H1 2026, benefiting from industry policies and a pickup in downstream demand, prices of major rare earth products in China climbed steadily. The company's rare earth resource comprehensive utilization segment seized market opportunities, fully leveraged its comprehensive advantages in capacity scale, cost control, and process technology, and continuously optimized supply, production, and sales coordination and inventory management strategies, effectively driving the full release of the segment's profitability. The company continued to deepen its layout across the rare earth industry chain, while its downstream rare earth permanent magnet materials business expanded steadily. Benefiting from steady demand in end-use sectors such as NEVs, wind power, and industrial automation, this business segment continued to expand its business scale, with revenue and product mix continuously optimized, and became an important supplement to performance growth. The semi-annual earnings forecast released by Xiamen Tungsten showed that, according to preliminary calculations by the finance department, net profit attributable to shareholders of the listed company for H1 2026 was expected to be approximately 2,216.0318 million yuan, up approximately 1,246.7133 million yuan from the same period last year, equivalent to an increase of approximately 128.62% YoY. According to preliminary calculations by the finance department, net profit attributable to shareholders of the listed company for H1 2026, excluding non-recurring gains and losses, was expected to be approximately 2,176.0263 million yuan, up approximately 1,253.4882 million yuan from the same period last year, equivalent to an increase of approximately 135.87% YoY. Regarding the main reasons for the expected performance growth in the period, Xiamen Tungsten explained: In H1, facing a market environment in which prices of major raw materials such as tungsten, cobalt, lithium carbonate, and Pr-Nd oxide rose YoY and swung wildly, the company responded proactively, dynamically adjusted its operating strategy, and drove a corresponding increase in product selling prices. Meanwhile, it continued to improve product quality and market development capabilities, and sales of main products such as alloy bars, cutting tools, power battery cathode materials, and magnetic materials grew steadily. Profitability of the company's three core businesses—tungsten and molybdenum, new energy materials, and rare earths—improved to varying degrees. Ningbo Yunsheng disclosed its earnings forecast on the evening of July 14, which showed that, according to preliminary calculations by the finance department, net profit attributable to shareholders of the listed company for H1 2026 was expected to be between 240 million yuan and 310 million yuan, an increase of between 132.1657 million yuan and 202.1657 million yuan compared with the same period last year (statutorily disclosed data), up 122.56% to 187.48% YoY. Net profit attributable to shareholders of the listed company after deducting non-recurring profit or loss for H1 2026 is expected to be RMB210 million to RMB280 million, an increase of RMB121.3954 million to RMB191.3954 million compared with the same period last year (statutorily disclosed data), up 137.01% to 216.01% YoY. Ningbo Yunsheng explained that the main reasons for the projected profit increase were as follows: during the reporting period, the company adhered to customer demand orientation, focused deeply on NEV, consumer electronics, industrial and other application fields, actively explored emerging and regional markets, seized development opportunities from new projects, continuously optimized its business mix, and increased the share of revenue from outside China. Meanwhile, the company continued to deepen refined management, which lifted product gross margins and thus increased net profit. The H1 earnings forecast released by China Northern Rare Earth shows that, based on a preliminary estimate by the company's finance department, net profit attributable to owners of the parent company for H1 2026 is expected to be RMB1.98 billion to RMB2.06 billion, an increase of RMB1.05 billion to RMB1.13 billion compared with the same period last year (statutorily disclosed data), up 112.74% to 121.33% YoY. Net profit attributable to owners of the parent company after deducting non-recurring profit or loss for H1 2026 is expected to be RMB1.99 billion to RMB2.07 billion, an increase of RMB1.093 billion to RMB1.173 billion compared with the same period last year (statutorily disclosed data), up 121.90% to 130.82% YoY. Main Reasons for the Projected Profit Increase in the Period: In H1 2026, the company supported the national rare earth resource strategy and fully implemented safety and control requirements across the rare earth industry chain. Driven by factors such as constrained raw material supply and the multi-point release and sustained growth of downstream demand, rare earth product prices showed an overall strengthening trend and consolidated. Centering on its annual production and operation targets, the company planned comprehensively and implemented a combination of measures, strengthened overall budget management, coordinated cost reduction, quality improvement and efficiency gains, scientifically organized production and scheduling, intensified marketing operations, deepened reform and innovation, strengthened group management and risk prevention and control, promoted the high-quality in-depth integration of professional management, lean management and 5S management, advanced key project construction, accelerated the development of new quality productive forces through management and research innovation, and, with sound industry chain value creation capability and core competitiveness, provided solid support and guarantee for its good operating results. The company scientifically refined its production organization and operations; production of rare earth smelting and separation products, rare earth metal products and new rare earth materials all reached record highs for the same period in history; the company's subsidiary Inner Mongolia Northern Rare Earth Magnetic Materials Co., Ltd. achieved operating revenue of approximately RMB9.5 billion in H1, up about 107% YoY, maintaining growth momentum for three consecutive years; its subsidiary Inner Mongolia Xikeao Hydrogen Storage Alloy Co., Ltd. officially put its first batch of 1,000 hydrogen-powered two-wheelers into operation in Baotou, with cumulative safe driving mileage reaching 170,000 km; the project has achieved notable demonstration results. The Company persisted in benchmarking against advanced peers both internally and externally to tap internal potential, strengthened refined management, and significantly improved a number of economic and technical indicators. It implemented targeted measures across each business segment: the smelting and separation segment overcame new changes in production costs brought by rising raw and auxiliary material prices, effectively controlled cost fluctuations, scientifically organized production and scheduling, and ensured new product supply needs; the rare earth metals segment took the strengthening of lean production concepts as its focus, used digital and intelligent means to further strengthen on-site process operation management, and drove new breakthroughs in economic and technical indicators such as quality and material consumption ratio; the rare earth new materials and applications segment fully leveraged its new capacity advantage, precisely matched customer demand, and achieved new progress in driving sales through production. It deepened industry chain coordination and linkage, and on the basis of ensuring stable product supply, consolidated the foundation of downstream customer cooperation. Shenghe Resources released its H1 earnings preview on July 10, which showed: according to preliminary estimates by the company's finance department, net profit attributable to shareholders of the parent company for H1 2026 is expected to be 800 million yuan to 930 million yuan, an increase of 423.0938 million yuan to 553.0938 million yuan compared to the same period last year, up 112.25% to 146.75% YoY. Net profit attributable to shareholders of the parent company excluding non-recurring items for H1 2026 is expected to be 790 million yuan to 920 million yuan, an increase of 426.487 million yuan to 556.487 million yuan compared to the same period last year, up 117.32% to 153.09% YoY. Regarding the main reasons for the expected earnings growth in the current period, Shenghe Resources said: During the reporting period, affected by factors such as rare earth industry policies and downstream demand, overall market demand for major rare earth products improved, and product prices and average selling prices rose significantly compared to the previous year. The company seized market opportunities, optimized its production and sales mix, strengthened management empowerment and cost control, and thereby drove substantial earnings growth. China Rare Earth said in its recently released semi-annual report: In H1, the supply-demand pattern of the rare earth industry continued to be adjusted and optimized. Supported by multiple favorable factors such as rare earth industry policies and stronger downstream demand, the market overall trended upward, and Pr-Nd product prices rose significantly compared to the same period last year. The company followed its annual work deployment, anchored its goals and added more pressure, seized the momentum and strived for excellence, strengthened Party building leadership, and focused on six key tasks including resource assurance, efficient operations, technological innovation, project construction, deepening reform, and capacity building. It made targeted efforts and achieved notable phased results, simultaneously improved operational quality and efficiency, successfully completed all operational targets and tasks, and vigorously created a new situation of high-quality leapfrog development, laying the foundation for a good start to the 15th Five-Year Plan period. In H1 , the company achieved revenue of 1.647 billion yuan, net profit of 237 million yuan attributable to shareholders of the listed company, up 46.53% YoY, and net profit of 240 million yuan attributable to shareholders of the listed company after deducting non-recurring gains and losses, up 55.49% YoY. The H1 earnings forecast disclosed by Tianhe Magnetics on July 9 showed that, based on preliminary estimates by its financial department, the company expected net profit attributable to owners of the parent company for H1 2026 to be between 73 million yuan and 93 million yuan, an increase of 19.5448 million yuan to 39.5448 million yuan compared with the same period last year (statutory disclosed data), up 36.56% to 73.98% YoY. It also expected net profit attributable to owners of the parent company after deducting non-recurring gains and losses for H1 2026 to be between 68 million yuan and 88 million yuan, an increase of 32.5723 million yuan to 52.5723 million yuan compared with the same period last year (statutory disclosed data), up 91.94% to 148.39% YoY. Regarding the main reasons for the expected H1 profit growth, Tianhe Magnetics said: 1. In H1, raw material prices fluctuated at high levels overall. The company optimized pricing strategies for some existing and new orders and raised product selling prices. 2. In 2026, the company proactively seized market opportunities, conducted sales efforts centered on "focusing on emerging markets, deepening customer relationships, and optimizing channel layout," achieved dual-driver growth in both international and domestic markets, and delivered notable results in market development. Overall operating revenue is expected to increase by about 30% YoY, with domestic business revenue expected to increase by about 50% YoY. 3. During the reporting period, non-recurring gains and losses are expected to have an impact of approximately 5 million yuan on net profit, compared with after-tax non-recurring gains and losses of 18.0275 million yuan in the same period last year. The H1 earnings forecast released by JL MAG Rare-Earth on July 1 showed that net profit attributable to the parent company for H1 2026 was expected to be between 400 million yuan and 460 million yuan, up 31.17%-50.84% YoY. Regarding the reasons for the performance change, JL MAG Rare-Earth said in its announcement: 1. In H1 2026, the company's management upheld the annual operating policy of "staying law-abiding and compliant, remaining customer-oriented, focusing on the core magnetic materials business, building 20,000 mt of capacity on schedule, proactively positioning in motor rotors for embodied robots, and scaling new heights." Through technological innovation, organizational optimization, digital development, lean management, and other measures, the company made every effort to ensure delivery to customers in accordance with contracts while achieving steady development of its operating performance. The company continued to consolidate its leading position in new energy, energy conservation and environmental protection, actively expanded into emerging markets, and expects operating revenue to increase by about 30% YoY. Within this, revenue in the NEV and auto parts segment is expected to increase by about 30% YoY; revenue in the robotics and industrial servo motor segment is expected to increase by about 90% YoY, and embodied robot motor rotor products have already seen small-batch deliveries. 2. During the reporting period, the impact of non-recurring items on net profit is expected to be approximately RMB32 million, compared with after-tax non-recurring items of RMB70.9405 million in the same period last year. 3. In the current reporting period, due to A-share and H-share equity incentives and the issuance of H-share convertible bonds, related share-based payment expenses, financial expenses, and other expenses totaled approximately RMB121 million; no such expenses occurred in the same period last year. The H1 2026 results flash released by Zhong Ke San Huan on the evening of July 20 showed that, in H1, the company achieved operating revenue of RMB3,613.7721 million, up 23.67% YoY; total profit of RMB102.8001 million, up 1.18% YoY; net profit attributable to shareholders of the listed company of RMB49.2189 million, up 11.88% from the same period last year; and, after deducting non-recurring items such as government subsidies, net profit attributable to shareholders of the listed company excluding non-recurring items of RMB32.3035 million, up 2.25% from the same period last year. Zhong Ke San Huan's semiannual results flash showed that in H1 2026, amid increasingly intense market competition and a complex and volatile external environment, with the joint efforts of all employees, the company's core product sales volume grew YoY; through cost-reduction measures such as optimizing formulation processes and reducing heavy rare earth usage, it drove the overall gross margin up YoY. Some subsidiaries improved operations, reducing losses or turning losses into profits; meanwhile, the company further improved inventory management, optimized the inventory structure of key raw materials, and reduced asset impairment losses YoY. Affected by the appreciation of the RMB against the US dollar and the euro, the company incurred foreign exchange losses during the reporting period, and financial expenses increased YoY, partially offsetting profit growth. In H1 This Year, Pr-Nd Oxide Rose 22.42%; Dysprosium Oxide and Terbium Oxide Both Increased In H1 2026, the rare earth oxide market experienced a "sharp rise—plunge—recovery—further divergence" roller-coaster ride. Pr-Nd oxide prices were the most volatile; dysprosium oxide and terbium oxide prices first rose, then fell, and then rebounded. A review of the H1 price trends of Pr-Nd oxide, dysprosium oxide, and terbium oxide shows the following: Pr-Nd oxide's average price on June 30 was 742,500 yuan/mt, up 136,000 yuan/mt from 606,500 yuan/mt on December 31, 2025, an H1 increase of 22.42%. Meanwhile, the H1 average daily price of Pr-Nd oxide this year was 740,530.17 yuan/mt, up 3,095,771.8 yuan/mt YoY from 430,952.99 yuan/mt in H1 2025, representing a YoY increase of 71.84%. Dysprosium oxide's average price on June 30 was 1,420 yuan/kg, up 80 yuan/kg from 1,340 yuan/kg on December 31, 2025, an H1 increase of 5.97%. Comparing dysprosium oxide's average daily price of 1,394.09 yuan/kg in H1 this year with 1,660.26 yuan/kg in H1 2025 shows that its H1 average daily price fell 16.03% YoY. Terbium oxide's average price on June 30 was 6,475 yuan/kg, up 500 yuan/kg from 5,975 yuan/kg on December 31, 2025, an H1 increase of 8.37%. Comparing terbium oxide's average daily price of 6,200.26 yuan/kg in H1 this year with 6,634.62 yuan/kg in H1 2025 shows that its H1 average daily price fell 6.55% YoY. Since the start of August, the rare earth market has remained in a sideways pattern amid the tug-of-war between upstream and downstream. At present, downstream inquiry and buying interest is limited, inquiry activity remains relatively thin, overall trading sentiment is sluggish, and rare earth prices have continued to diverge: in the Pr-Nd market, affected by continued pullbacks in futures prices, some suppliers have slightly lowered their offers; medium-heavy rare earth prices have shown strong resilience and remained broadly stable. In the short term, affected by the stalemate in market trading, Pr-Nd product prices are expected to continue moving sideways. Over the medium and long term, SMM expects that the overall supply of Pr-Nd oxide in 2026 will remain on the tight side, but with new capacity gradually coming on stream in H2 and previously uncommissioned smelting and separation capacity planned to start production, pressure from a loosening supply side may emerge later on. On the demand side, rising toll-processing orders at metal plants in Inner Mongolia will provide some rigid demand support for Pr-Nd oxide. As the traditional "September-October peak season" approaches, the market holds strong expectations for downstream restocking and stockpiling, and end-use demand still has a considerable number of NEV orders to be released in H2. The industrial robot sector remains buoyant, and demand for rare earth permanent magnets is expected to show a notable YoY increase this year. Meanwhile, although emerging sectors such as humanoid robots and the low-altitude economy are developing rapidly and have ample long-term growth potential, they are still in the early stages of industry development, and their actual incremental contribution to rare earth permanent magnets remains limited for now. Whether peak-season demand expectations materialize and the pace of new capacity release will be key variables shaping rare earth market trends ahead. Views from Various Parties According to a Datong Securities research report from August 11, rare earth spot prices pulled back in the short term and downstream magnetic material enterprises were cautious in procurement. However, with supply constrained by three factors—tighter mining quotas, escalated export controls, and production cuts in scrap recycling—along with restocking demand outside China, the strategic revaluation logic had not been shaken. Overall, policy controls and demand from emerging industries drove the minor metals sector; the commodity and financial attributes of scarce resources reinforced each other, and the valuation recovery rally continued. A China Securities research report said, citing data from the General Administration of Customs, that rare earth exports fell markedly in July while average prices rose. July rare earth exports were 4,223.5 mt, down 29.54% YoY and 17.26% MoM, the lowest monthly level since March; cumulative January-July exports were 34,706.3 mt, down 10% YoY. However, the corresponding average export price was $12.34/kg, surging 103.14% YoY, with the export mix tilting toward high-value medium-heavy rare earth products. Markets outside China accepted high-priced raw materials, and the tight global rare earth supply pattern continued. There was no incremental rare earth supply for now; separation enterprises were producing steadily; previously suspended enterprises had no plans to resume production for now; downstream rigid demand provided moderate support; and long-term demand expectations were improving. Rare earth prices are expected to consolidate on a strong note in the near term. A CITIC Securities research report said that, against a backdrop of quota constraints and falling imports, rare earth supply rigidity continued to strengthen. Affected by stricter tax policies, operating rates at scrap recycling enterprises remained persistently low. Rigid-demand restocking along the industry chain, together with the approaching peak season, is expected to drive a demand recovery. Emerging fields such as robotics, the low-altitude economy, and industrial motors are expected to open up long-term demand growth. The rare earth industry's supply-demand pattern may remain tight. Driven by rising prices, H1 earnings at rare earth industry chain companies are expected to beat expectations. CITIC Securities continued to recommend the strategic allocation value of the rare earth industry chain. Recommended Reading: For more fundamental, technical, and policy information on motor raw materials such as rare earth, copper, and aluminum, please join: ~

KSH International has commenced production at a new 5,000 t/y upcast copper rod facility in Pune. The project supports backward integration and allows the company to recycle part of its own copper process scrap into rods for captive consumption, replacing a model under which process scrap was largely sold externally.

【SMM Tungsten Express】US scrap trader Tungco plans to build a 3,000 tpa tungsten scrap recycling plant in Kentucky, codenamed "Project 74." The company is seeking public subsidies and promoting the project under the "urban mining" concept to strengthen domestic tungsten recycling capacity in the United States.

Second-life battery cell market remained steady overall this week. Upstream raw material cost support weakened. Lithium carbonate briefly rebounded during the week before its overall center shifted lower. Nickel sulphate futures ran steady, while cobalt sulphate continued its sustained downward trend. The raw material side failed to provide effective support for second-life battery cell prices. The supply side was notably impacted by the MIIT Announcement No. 20 on July 30. The document abolished the previous clauses related to power battery second-life applications, removed over a hundred listed second-life enterprises from the compliance catalog, and explicitly prohibited the use of retired power batteries in two-wheeler EV applications. Driven by the policy, dismantled second-life battery cells accelerated their flow into recycling and smelting channels. Quotations for dismantled supply fell under pressure, with some specifications' prices gradually converging toward scrap recycling prices, signifying a structural reshaping of the pricing logic for second-life battery cells. On the demand side, using second-life batteries in the small power sector was already a violation. The new policy means this gray market has been completely eliminated at the regulatory level. The energy storage scenario has become the core demand support for second-life battery cells. Energy storage demand remained stable, but downstream acceptance of high prices was limited, with procurement primarily driven by rigid demand and insufficient momentum for price increases. In the short term, the market is expected to maintain stable operation.

Atlantic Copper plans to inaugurate its CirCular project in Huelva on September 14. The facility is designed to process up to 60,000 tonnes per year of non-ferrous material derived from waste electrical and electronic equipment, recovering copper, gold, silver, palladium, platinum, tin and nickel. Earlier company disclosures placed investment at more than €400 million, while a recent local report cited €550 million, possibly reflecting a different project scope.

Recently, the NDRC is working with relevant departments to accelerate the study and formulation of the Implementation Plan for the Strategy of Expanding Domestic Demand (2026-2030). Moving forward, the NDRC will work with relevant departments to effectively expand China's domestic demand with greater intensity and more concrete measures.