[SMM Analysis：Rare Earth Scrap Recycling Slows as Tax Compliance Tightens, Impacting Production Rates]Recently, multiple rare earth scrap recycling enterprises reported that operating rates may decline in June-July. Large enterprises, with a higher proportion of self-procurement, are seeing more significant production reductions; small and medium-sized enterprises, relying less on self-procurement and more on processing orders, are relatively less affected.

[SMM Rare Earth Weekly Review: Rare Earth Market Shows Mixed Performance, Tug-of-War Between Upstream and Downstream Continues] Influenced by short covering by bears, futures prices rose, slightly boosting downstream willingness to restock. Procurement volumes for Pr-Nd oxide edged up compared to the previous period, and supplier quotes also rebounded slightly. As of today, Pr-Nd oxide prices fluctuated upward to 697,000-700,000 yuan/mt.

In May, the rare earth market entered its traditional off-season. Although occasional factors such as major producers' procurement briefly boosted rare earth prices, weak downstream demand kept prices under pressure and pulling back overall throughout May. Pr-Nd oxide and dysprosium oxide fell 11% and 11.79% respectively in May, while terbium oxide also edged down. On the supply side, however, an increasing trend emerged — domestic rare earth oxide production was up MoM across the board in May. Combined with continued inflows of ex-China sources, imports of unlisted rare earth oxides in the first four months surged 103% YoY. This supply-demand mismatch further suppressed rare earth price performance in May. Since early June, Pr-Nd oxide and other rare earth products have seen slight price rebounds, driven by major producers' restocking and futures fluctuations. However, the off-season demand shortfall persists — how will the rare earth market perform going forward? Pr-Nd Oxide Down 11% in May, Dysprosium Oxide Down 11.79%, Terbium Oxide Down 1.63% Light rare earth prices: Taking the historical price trend of Pr-Nd oxide as an example, according to SMM quotes: the average price of Pr-Nd oxide on May 29 was 687,500 yuan/mt, compared with its April 30 average price of 772,500 yuan/mt, representing a decline of 85,000 yuan/mt in May, with a monthly drop of 11%. Entering June, Pr-Nd oxide continued to rise, with an average price of 700,500 yuan/mt on June 2. Medium-heavy rare earth prices: Taking the trend of dysprosium oxide as an example, according to SMM quotes: the average price of dysprosium oxide on May 29 was 1,230 yuan/kg, compared with its April 30 average price of 1,375 yuan/kg, representing a decline of 145 yuan/kg in May, with a monthly drop of 11.79%. Entering June, dysprosium oxide prices edged up slightly, with an average price of 1,240 yuan/kg on June 2. Taking the trend of terbium oxide as an example, according to SMM quotes: the average price of terbium oxide on May 29 was 6,025 yuan/kg, compared with its April 30 average price of 6,125 yuan/kg, representing a decline of 100 yuan/kg in May, with a monthly drop of 1.63%. Entering June, terbium oxide prices rose slightly, with an average price of 6,035 yuan/kg on June 2. Oxide Production Up MoM Across the Board in May Production: Due to increased production from scrap recycling enterprises and production resumptions at some enterprises that had previously undergone equipment maintenance, production of Pr-Nd oxide and other rare earth oxides edged up in May compared with April. Imports of Unlisted Rare Earth Oxides Up 103% YoY, January-April According to data from the General Administration of Customs, China's imports of thorium ore and concentrates totaled 21,443 mt from January to April 2026, nearly flat YoY. Imports in April were 4,081 mt, up 22% MoM but up 32% YoY. From January to April 2026, China's imports of unlisted rare earth oxides reached approximately 26,123 mt, a significant YoY increase of 103%. Currently, the operating rate of ex-China rare earth mines remains relatively high, keeping actual supply in the international market at ample levels. Outlook Recently, rare earth prices rose due to futures market price fluctuations and periodic restocking by some large enterprises. However, as downstream orders were unsatisfactory, even though raw material inventory at downstream enterprises remained at relatively low levels, end-user wait-and-see sentiment was strong and enterprises showed little enthusiasm for restocking and stockpiling. It is expected that rare earth prices will be in the doldrums again until downstream orders see a notable increase and market confidence shows clear recovery. Recommended reading:

[SMM Tungsten Daily Review: Improved Trading Lifts Tungsten Market Volume and Prices, End-Use Demand Follow-Through Remains Key Focus for the Outlook] SMM June 3 report: The tungsten market posted steady gains this week, with related products across the industry chain rising across the board. Tungsten ore and APT markets recorded six consecutive days of increases. New orders from downstream powder enterprises began to gradually improve. Supported by increased trading volume and rising costs, powder enterprises successively raised their quoted prices. Downstream and end-user enterprises shifted from sporadic rigid-demand purchases to bulk purchasing, bullish sentiment grew increasingly strong, and price gains were concentrated in upstream raw materials and the APT segment, while deep-processed products passively rose following costs.

In May, European APT prices held firm above $3,000/mtu amid tight supply, while scrap tungsten dropped sharply. China's tungsten prices rebounded late in the month as sentiment improved, though downstream demand remained soft. A cautious bottoming trend emerged.

Raw material side, spot lithium carbonate prices oscillated slightly lower this week, nickel salt prices saw some pullback, and cobalt salt prices continued to decline. This week, by material type including ternary, LCO, and LFP: LFP hydrometallurgical segment, taking LFP electrode black mass as an example, current LFP electrode black mass prices were 7,550-7,900 yuan/mtu, with prices down significantly WoW from Tuesday's transactions.

[SMM Rare Earth Weekly Review: Rare Earth Prices Fluctuated, Upstream and Downstream Remained in Stalemate] Affected by futures price fluctuations combined with periodic restocking by some major producers, Pr-Nd oxide prices fluctuated relatively frequently. Upstream and downstream continued to remain in a stalemate, with suppliers maintaining relatively firm offers overall, while downstream metal producers maintained a strong wait-and-see sentiment. As of today, Pr-Nd oxide prices fluctuated downward to 682,000-688,000 yuan/mt.

On May 12, the 2026 SMM (3rd) Global Renewable Metal Industry Chain Summit & Battery Recycling Forum , organized by Shanghai Metals Market (SMM), drew to a successful close at the Sheraton Grande Tokyo Bay Hotel in Tokyo, Japan! Following the event, SMM arranged an overseas field trip for delegates. The delegation paid visits to renowned local recycling enterprises in Japan to learn about operational practices and technological advancements in Japan's recycled non-ferrous metal sector. On the afternoon of May 15, the delegation visited KINKI SANGYO CO.,LTD. and received a warm welcome from the firm’s management. Company Profile KINKI SANGYO CO.,LTD. has grown steadily since its founding with the support of numerous partners, always adhering to the core objectives of responding to the needs of the times and driving industrial development. As its business scale has expanded, the company has gradually established a solid industrial foundation in the field of metal resource recycling and built a stable supply system covering both China and ex-China markets. Headquartered in Izumi-Otsu City, Osaka Prefecture, with a sales office in Izumi City, the company maintains high-standard professional operations throughout the entire process—from the procurement and processing of metal scrap to sales and export—and is committed to contributing to industrial development in Japan and the broader Asian region. The company is well aware that sustained corporate growth depends on trustworthy quality and efficient management. To this end, the company has fully implemented and obtained ISO 9001 certification, the quality management system established by the International Organization for Standardization (ISO). Through this system, the company has established rigorous operational procedures and quality control mechanisms, ensuring that product quality remains consistently stable and reliable, and guaranteeing the continuous supply of high-grade metal raw materials that meet the requirements of steelmaking enterprises and other partners. The spirit of continuous improvement advocated by ISO 9001 has also become part of the company culture, with all employees constantly pursuing greater efficiency and superior quality in their daily work, with enhancing client satisfaction as their shared goal. In terms of business philosophy, the company adheres to a "people-oriented" approach, believing that talent is the most fundamental resource of an enterprise. The company encourages employees to continuously enhance their capabilities, closely integrating personal growth, corporate interests, and social value, earning the trust of partners through honest management and steady development. The company actively promotes open cooperation, establishing long-term and stable business relationships with various industries in and outside China, while continuously exploring new market opportunities to build a broader and more solid international network for the future. Looking ahead, KINKI SANGYO CO.,LTD. will continue to leverage its professional expertise, international vision, and rigorous quality management system to continuously strengthen its comprehensive competitiveness, contributing to socioeconomic development, resource recycling, and broader international cooperation. This visit was an important practice of SMM in building an international recycled metals industry exchange platform, creating a bridge for direct dialogue and experience sharing between Chinese and Japanese enterprises. Through on-site observation and face-to-face exchanges, attendees gained in-depth understanding of KINKI SANGYO CO.,LTD.'s technological advantages, operational management experience, and market positioning strategies in the recycled metals sector. They gained particularly valuable insights in areas such as refined processing of scrap metals and collaborative operations across the entire industry chain, providing valuable references for Chinese enterprises to optimize production models and enhance technological capabilities.

On May 12, the 2026 SMM (3rd) Global Renewable Metal Industry Chain Summit & Battery Recycling Forum , organized by Shanghai Metals Market (SMM), drew to a successful close at the Sheraton Grande Tokyo Bay Hotel in Tokyo, Japan! Following the event, SMM arranged an overseas field trip for delegates. The delegation paid visits to renowned local recycling enterprises in Japan to learn about operational practices and technological advancements in Japan's recycled non-ferrous metal sector. On the morning of May 15, the delegation visited Toyo Trading Co., Ltd. and received a warm welcome from the firm’s management. Company Profile Toyo Trading , officially established in 2009, has consistently upheld "resource recycling to promote sustainable development" as its core mission. Steadily cultivating its presence in Japan's metal recycling and trading sector over sixteen years, the Group has built a large-scale operation covering the entire industry chain. Today, it has developed an integrated full-chain service capability encompassing "collection — processing — sales — export," with its business footprint spanning all of Japan. The Group now owns over 20 specialized subsidiaries, each focusing on specific segments such as copper scrap and aluminum scrap recycling, refining, processing, and international trade. Meanwhile, the Group has assembled 300 professionals with extensive industry experience, ensuring efficient operations and consistent service quality across all aspects from supply chain management to international trade negotiations. Annual output includes copper (25,000 mt), aluminum (25,000 mt), iron (100,000 mt), and others (250,000 mt). Annual sales revenue reached 70 billion yen, making it one of the largest and most reputable enterprise groups in Japan's metal recycling industry. Toyo Trading has established a quality management system in strict accordance with international standards and has successfully obtained ISO9001 international quality management system certification. This signifies that the Group has reached internationally advanced levels in quality management, process control, and client service, providing clients with solid quality assurance. Looking ahead, Toyo Trading will continue to build on its core business of metal recycling and trading, further deepening its industry chain layout: on one hand, continuously optimizing its service network and processing technologies to enhance resource recovery efficiency and raw material quality; on the other hand, actively exploring green and low-carbon development pathways to drive the industry's transformation toward a greener, more efficient, and sustainable direction, enabling the infinite circulation of finite resources. Toyo Group will continue to uphold the philosophy of integrity-based management, deepen collaboration with clients and partners, and sincerely welcome business partners from around the world to discuss cooperation, pursue mutual development, achieve win-win collaboration, protect the planet, and co-create a sustainable future. This visit was an important practice of SMM's efforts to build an international recycled metals industry exchange platform, serving as a bridge for direct dialogue and experience sharing between Chinese and Japanese enterprises. Through on-site observation and face-to-face exchanges, attendees gained in-depth understanding of Toyo Trading's technological advantages, operational management experience, and market layout strategies in the recycled metals sector. They particularly benefited from insights into refined processing of scrap metals and collaborative operations across the entire industry chain, providing valuable references for Chinese enterprises to optimize production models and enhance technological capabilities.

On May 12, the 2026 SMM (3rd) Global Renewable Metal Industry Chain Summit & Battery Recycling Forum , organized by Shanghai Metals Market (SMM), drew to a successful close at the Sheraton Grande Tokyo Bay Hotel in Tokyo, Japan! Following the event, SMM arranged an overseas field trip for delegates. The delegation paid visits to renowned local recycling enterprises in Japan to learn about operational practices and technological advancements in Japan's recycled non-ferrous metal sector. On the afternoon of May 14, the delegation visited Uchida Corporation and received a warm welcome from the firm’s management. Company Profile Uchida Corporation was established in 2013 and is headquartered in Itami City. The company specializes in the recycling and processing of non-ferrous metals and special metals such as copper, aluminum, and stainless steel. It owns two recycling plants and one copper wire nodules processing plant, with a monthly processing capacity exceeding 1 kt. The company upholds the development philosophy of efficiency and environmental protection, deeply cultivating the field of secondary resource recycling and utilization, and is committed to creating long-term sustainable value for its clients. The enterprise adheres to the principle of "an honest work attitude and a spirit of continuous challenge," linking resources to industry and connecting the future with expertise. It continues to set new benchmarks for industry development, aspiring to build a high-quality enterprise that dares to take on challenges, grows steadily, and develops for the long term. This visit was an important practice of SMM's efforts to build an international exchange platform for the secondary metals industry, creating a bridge for direct dialogue and experience sharing between Chinese and Japanese enterprises. Through on-site observation and face-to-face exchanges, the attendees gained in-depth understanding of Uchida Corporation's technological advantages, operational management experience, and market positioning strategies in the secondary metals sector. They gained particularly valuable insights in areas such as refined processing of scrap metals and collaborative operations across the entire industry chain, providing valuable references for enterprises in China to optimize production models and enhance technological capabilities.