Neodymium (Nd): The Primary Magnet Rare Earth

Neodymium is the dominant magnet rare earth element. NdFeB permanent magnets contain 25-35% Nd by weight and comprise 95%+ of all rare earth magnet applications. Global Nd demand is driven by electric vehicle motors and wind turbine generators. Nd is classified as a light rare earth (LREE) but commands magnet REE pricing premiums.

Neodymium Fundamentals

Chemical Properties

• Atomic Number: 60
• Symbol: Nd
• Atomic Weight: 144.24
• Valence: +3 oxidation state
• Soft, silvery metal. Highly reactive with oxygen and moisture.

Mining & Processing

• Primary ores: Bastnaesite (China, Vietnam), monazite (Australia, Myanmar)
• Processing method: Solvent extraction (SX) or ion exchange (IX)
• Common forms: Nd oxide (Nd2O3), Nd metal, NdFeB alloys
• Production cost: ~$5-15/kg Nd metal equivalent (varies with processing efficiency)

Supply Fundamentals

Global Production

• 2024 production: ~60,000 tonnes Nd content per year
• China share: 70-80% of global separation capacity
• Non-China separation: Growing but limited (Japan, India, USA emerging)
• Major producers: China, Vietnam, Myanmar (mining); China dominant (separation)

Reserves & Resources

• Global reserves: ~120 million tonnes REO equivalent (includes Nd)
• Nd-specific reserves: Not independently reported; embedded in REE reserves
• Caveats: Reserves are abundant. Constraint is processing capacity, not elemental scarcity.

End-Use Demand Drivers

EV Motors

• Each EV motor contains 0.5-1.5 kg Nd in NdFeB magnets
• Global EV sales: ~14 million units in 2024, growing to 25+ million by 2030
• Structural demand tailwind from policy incentives and tech adoption
• Nd demand from EV motors alone: ~30,000+ tonnes/year by 2030

Wind Turbines

• Direct-drive wind generators use 200-600 kg magnets per MW (magnet-heavy designs)
• Global wind capacity additions: 50-100 GW/year
• Nd demand from wind: ~5,000+ tonnes/year and growing

Industrial & Consumer Applications

• Hard disk drives (legacy, declining)
• Consumer electronics (headphones, speakers, actuators)
• Medical devices and aerospace
• Industrial pumps, compressors, robotics

Pricing & Market Dynamics

Price Range

• Current range (2024): $50-80/kg Nd metal
• Historical volatility: $20/kg (2015-2016) to $150+/kg (2021)
• Price benchmark: Publicly assessed by Metal Bulletin and Asian Metal

Price Drivers

• EV production cycles and policy changes
• Wind energy capacity additions
• Geopolitical supply shocks (China export controls)
• Separation capacity utilization and capex cycles

Investment Routes

• Nd mining and separation stocks
• NdFeB magnet manufacturers
• REE ETFs with Nd exposure
• Indirect exposure via automotive OEMs (Tesla, BYD, VW)

Key Risks

• Substitution: Alternative magnet technologies or direct-drive motors could reduce Nd demand.
• China leverage: Export controls or trade restrictions could spike prices.
• Demand cycle: EV sales are policy-dependent. Incentive changes affect demand.
• Processing bottleneck: Separation capacity expansion is slow. New capex often misses timelines.

Key Takeaways

• Neodymium is the dominant magnet REE, critical for EV and wind growth
• Global Nd demand is structural and policy-supported through 2030
• Supply constraint is processing capacity, not elemental scarcity
• NdFeB magnet makers and Nd separators command premium margins during supply crunches
• China dominance creates geopolitical leverage; Western supply alternatives are investment priority