Special report on rare earth permanent magnet materials industry: energy saving and high efficiency opens the curtain of demand, and permanent magnet materials set sail again

The high demand for rare earth magnetic materials will accelerate the expansion of production, and the industry concentration and leading market share will accelerate; The head manufacturers have basically completed the cost transmission, and the profit has hit the bottom, with a large margin for improvement.

Summary:

Give the rare earth magnetic material industry "overweight" rating. The magnetic material industry benefits from the high growth in the downstream and maintains a high outlook. The rapid expansion of production by manufacturers is expected to achieve the same increase in volume and profit, and the valuation advantage is obviou.

Profit bottomed out and marginal improvement expectations were strong. The continuous rise of rare earth prices has brought pressure on the cost side of magnetic materials. On the one hand, manufacturers have accelerated internal management and production optimization to reduce costs. On the other hand, the industry has accelerated the integration and elimination of small and medium-sized manufacturers to promote the concentration of the industry to the head. By adjusting the pricing method and cycle, optimizing the product and customer structure, accelerating the application of cost reduction technology and other cost transmission paths, magnetic head manufacturers have hit the bottom of profits and strong marginal improvement expectations. At present, the net profit per ton of Nd-Fe-B blank output of major magnetic material manufacturers is about 30000 yuan. Some manufacturers enjoy excess returns by virtue of their advantages, segmentation direction and customers. In this round of rare earth price rise, the pricing mode of magnetic material manufacturers has been greatly optimized, and the impact of rare earth price fluctuations on profits will be reduced in the future.

Increase the market share and industry concentration of manufacturers. Major listed companies accelerated their production expansion driven by high demand and full orders. The main growth areas in the downstream are electric vehicles, industrial motors, wind power, etc., all of which have high requirements on the qualification, production capacity and delivery capacity of suppliers; In addition, the sharp rise in rare earth prices has led to the growth of capital occupation and the relatively long accounting period of downstream new energy vehicles and wind power, driving the industry to concentrate on leading manufacturers with strong capital, technology and capacity. In 2021, the growth rate of production capacity and output of listed companies is much higher than that of the industry. From 2022 to 2025, the production capacity of neodymium iron boron blank of listed companies will increase from 82000 tons / year to 190000 tons / year, and the market share will increase from about 20% to 45-50%, forming an oligarch competition pattern in the medium and high-end market.

Demand remains high and can fully absorb capacity expansion. From 2022 to 2025, the demand for medium and high-end Nd-Fe-B in the fields of new energy vehicles and industrial motors will increase from about 90000 tons to 180000 tons, with a compound annual growth rate of about 20%, and the demand increment will exceed 90000 tons; With the expansion and penetration of leading manufacturers in other fields at home and abroad with the help of cost and capacity advantages, some capacity will be digested, and the overall supply and demand of the industry will remain in balance.

Risk factors: the price of rare earth fluctuates rapidly and sharply, the growth of new energy vehicles is less than expected, and the steady growth in China is disturbed by the epidemic.