Summary of China Rare Earths 2026 Outlook Call Industry Overview - **Industry**: Rare Earths - **Key Players**: Northern Rare Earth High-Tech (NRE), China Rare Earth Resources and Technology (CRE), JL Mag Rare-Earth Core Insights - **Supply Discipline**: China's rare earth supply discipline has transitioned to a structural level due to the extension of smelting and separation quotas to imported ores starting in 2025, reducing supply elasticity across the system. SMM anticipates a ~10% year-over-year growth in China's supply for 2026E [2][3] - **Imports**: US-origin rare earth ore imports have dropped to nearly zero since August 2025, following MP Materials' export suspension to China. This supply gap has been compensated by increased imports from Africa, while Myanmar's supply share is expected to decline due to rising tax uncertainty and political risks [3] - **Exports**: SMM forecasts approximately 9% year-over-year growth in exports for 2026E [4] Recycling and Demand - **Recycling**: Recycling has become a significant marginal supplier, with recycled PrNd accounting for ~25% of total PrNd supply in 2025, projected to rise to ~35% in 2026 due to planned capacity additions [4] - **Demand Growth**: SMM expects magnet demand to grow by 15-18% year-over-year in 2026E, driven by the adoption of NEVs (20% production growth), wind power (10% installation growth), air conditioners (11% production growth), and industrial robotics (8-10% growth). Humanoid robots are still in early stages, contributing less than 3% to total demand [5] Pricing Outlook - **Pricing Expectations**: SMM anticipates a slightly tight balance in 2026E, with potential short-term price spikes reaching ~Rmb700k/t. HREE pricing is more influenced by policy than supply dynamics [8] Company Valuations - **Northern Rare Earth (NRE)**: Valued at Rmb72 using a P/B-based methodology, reflecting a 9.5x target 2026E P/B, which is a +2.0 standard deviation premium to its historical average. The valuation considers structural demand growth and tighter resource control [9] - **China Rare Earth (CRE)**: Valued at Rmb61.6 with a 12x target 2026E P/B, set at +1.5 standard deviations above its historical average, reflecting similar structural factors as NRE [11] - **JL Mag Rare-Earth**: Valued at Rmb32.6 for JL Mag-A and HK$25.3 for JL Mag-H based on 2027E earnings, applying lower P/E multiples to account for potential downside risks in the robotics sector [14][16] Risks - **Key Risks for NRE and CRE**: Include demand growth uncertainty in downstream applications, unexpected capacity expansions outside China, trade barriers, price volatility, policy adjustments in China, emergence of alternative materials, and sector consolidation activities [10][12] Conclusion The rare earth sector is poised for growth driven by structural changes in supply discipline, increasing demand from various industries, and a significant role of recycling. However, companies must navigate geopolitical risks and market volatility as they position themselves for the future.

Core Viewpoint - The colored metal ETF (512400) is experiencing significant growth, driven by rising prices in precious and industrial metals, with expectations for continued upward momentum in the sector due to various macroeconomic factors [1][2][3]. Group 1: Market Performance - As of January 26, 2026, the colored metal ETF (512400) increased by 4.62%, with a trading volume of 1.108 billion yuan and a turnover rate of 2.8% [1]. - The index tracking the colored metal sector, the Zhongzheng Shenwan Colored Metal Index, saw notable gains in individual stocks, including silver rising by 10.03%, Hunan Gold by 10.01%, and Xingye Silver Tin by 9.99% [1]. - The colored metal sector has attracted significant investment, with over 36 billion yuan net inflow into colored metal-themed ETFs (excluding gold) this year, bringing the total scale to over 100 billion yuan [2]. Group 2: Price Trends and Predictions - On January 26, spot gold prices surpassed $5,080 per ounce, marking a new high with an intraday increase of over 2%, while spot silver rose over 3% to reach $106.83 per ounce [2]. - Historical patterns suggest that gold prices may increase between 10% and 35% in 2026, influenced by expectations of Federal Reserve interest rate cuts, instability in the US dollar, midterm elections, and geopolitical uncertainties [2]. - The recent surge in metals such as gold, silver, tin, and lithium indicates a potential bull market for colored metals, with ongoing valuation adjustments lagging behind commodity price increases [2]. Group 3: Investment Sentiment and Strategies - Fund companies and investors are increasingly focusing on the colored metal sector, with public funds significantly increasing their positions in this industry by the fourth quarter of 2025 [2]. - Current market narratives driving global asset performance include the weakening of the US dollar credit cycle, the formation of a new monetary system anchored by gold pricing, and the reconfiguration of global supply chains [3]. - The colored metal ETF (512400) closely tracks the Zhongzheng Shenwan Colored Metal Index, which comprises 50 listed companies in the colored metal and non-metal materials sectors, reflecting the overall performance of this industry [3].

Investment Rating - The industry rating is "Recommended" [3] Core Views - Short-term raw material supply tightness is expected to support nickel prices, with LME nickel spot price reaching $18,630 per ton, up 5.70% from January 16 [1] - The cobalt market is anticipated to see continued price increases due to structural supply tightness, with electrolytic cobalt priced at 438,000 yuan per ton, down 3.74% from January 16 [2][5] - Domestic antimony supply remains tight, providing price support, with antimony ingot prices at 160,500 yuan per ton [6] - Lithium carbonate prices are expected to continue rising, with a market average of 171,100 yuan per ton, up 8.36% from January 16 [8][19] - Supply uncertainties in the rare earth market are expected to support prices, with significant global supply concentration in China [10][20] - Tin prices are supported by overseas supply uncertainties, with LME tin prices at $54,200 per ton, up 9.66% from January 16 [11][21] - Tungsten market supply-demand imbalance is notable, with white tungsten concentrate prices at 535,500 yuan per ton, up 5.93% from January 16 [13][22] - Uranium supply tightness is expected to persist, with global uranium prices at $63.51 per pound [14][15] Summary by Sections Nickel and Cobalt Industry Update - Nickel prices are supported by supply constraints, with Indonesia's nickel mining production quota expected to be reduced to 250-260 million tons [1][16] - Cobalt supply is projected to tighten further, with Congo's export quotas confirmed to extend into 2026 [2][17] Antimony Industry Update - Antimony supply remains tight, with domestic prices expected to rise due to export restrictions and seasonal supply issues [6][18] Lithium Industry Update - Lithium carbonate prices are expected to remain strong due to demand support and supply uncertainties, particularly regarding the recovery of key lithium mines [8][19] Rare Earth Industry Update - The rare earth market is facing supply tightening due to export bans and geopolitical factors, with China maintaining a dominant position [10][20] Tin Industry Update - Tin prices are supported by uncertainties in overseas supply, particularly from Myanmar and Congo [11][21] Tungsten Industry Update - The tungsten market is experiencing a supply-demand imbalance, with prices expected to rise due to limited new supply [13][22] Uranium Industry Update - Uranium prices are supported by ongoing supply tightness and geopolitical factors affecting production [14][15]

Group 1: Copper - The LME copper price increased by 0.25% to $12,840.0 per ton, while the Shanghai copper price rose by 0.57% to ¥101,300 per ton [1] - Copper concentrate processing fees fell to -$49.79 per ton, and national copper inventory increased by 2.9% week-on-week, with a year-on-year increase of 203,000 tons [1][13] - The operating rate of copper cable enterprises increased by 2.72 percentage points to 58.71%, with a year-on-year increase of 15.87% [1][13] Group 2: Aluminum - The LME aluminum price rose by 0.29% to $3,137.5 per ton, and the Shanghai aluminum price increased by 1.53% to ¥24,300 per ton [2][14] - The operating rate of domestic aluminum processing enterprises fell by 6.3 percentage points to 51.1% due to the upcoming Spring Festival [2][14] - Electrolytic aluminum ingot inventory decreased by 6,000 tons to 743,000 tons [2][14] Group 3: Gold - COMEX gold price increased by 6.88% to $4,938.4 per ounce, with SPDR gold holdings rising by 4.86 tons to 1,079.66 tons [3][15] - Geopolitical risks have led to a strong fluctuation in the gold market [3][15] - The 10-year TIPS yield decreased by 0.07 percentage points to 1.95% [3][15] Group 4: Rare Earths - The price of praseodymium and neodymium oxide decreased by 0.25% to ¥672,700 per ton [4][36] - December exports of rare earth permanent magnets increased by 7% year-on-year, indicating a recovery in exports [4][36] - The rare earth sector is expected to see upward price momentum due to supply constraints and favorable export conditions [4][36] Group 5: Tungsten - Tungsten prices increased by 5.54% this week, supported by tight supply conditions [4][38] - The establishment of a $2.5 billion "strategic resilience reserve" in the U.S. may elevate tungsten's priority [4][38] - The price of ammonium paratungstate rose by 6.06% to ¥790,500 per ton [4][38] Group 6: Tin - Tin prices increased by 2.19% to ¥423,700 per ton, with inventory rising by 1.79% to 9,720 tons [4][38] - Supply from Indonesia and Myanmar remains below expectations, supporting an upward price trend [4][38] - The demand outlook is positive due to recovery in semiconductor and photovoltaic sectors [4][38] Group 7: Lithium - The average price of lithium carbonate rose by 0.8% to ¥159,500 per ton, while lithium hydroxide increased by 2.0% to ¥156,900 per ton [4][63] - Lithium production decreased slightly, with total output at 22,200 tons, down by 40 tons [4][63] - The market is experiencing strong demand, with signs of pre-holiday stocking [4][63] Group 8: Cobalt - Cobalt prices decreased by 3.7% to ¥437,000 per ton, while cobalt intermediate prices increased by 1.5% to $25.75 per pound [5][65] - Supply tightness is expected to persist, with domestic prices showing upward momentum [5][65] - The market structure remains tight due to limited liquidity and long transportation cycles [5][65]

Investment Rating - The investment rating for the small metals industry is "Positive" (maintained) [5] Core Views - The supply-demand tension continues, with tungsten and tin prices breaking historical highs [4] - Rare earth elements are experiencing a supply tightness, leading to increased prices, particularly for praseodymium and neodymium oxide, which rose by 7.69% to 672,500 CNY/ton [12] - Molybdenum prices are expected to stabilize due to cost support and improved supply-demand dynamics, despite a recent decline [23] - Tungsten prices are at historical highs due to supply contraction and price increases in long-term contracts [30] - Tin prices are strong due to macroeconomic factors and ongoing supply disruptions, with SHFE tin rising by 21.85% to 429,600 CNY/ton [33] - Antimony prices are fluctuating, awaiting signals for export recovery, with recent increases noted [42] Summary by Sections Rare Earths - Praseodymium and neodymium oxide prices increased by 7.69% to 672,500 CNY/ton, while dysprosium decreased by 1.39% to 1,420,000 CNY/ton [12][4] - The supply side remains tight due to policy and supply constraints, while demand from downstream magnetic material companies has shifted from just-in-time purchasing to stockpiling [4] Molybdenum - Molybdenum concentrate prices fell by 1.94% to 4,035 CNY/ton, and molybdenum iron prices decreased by 1.90% to 258,500 CNY/ton [23] - The market sentiment is supported by a stabilization in international molybdenum oxide prices and reduced mine shipments [23] Tungsten - Black tungsten concentrate prices rose by 11.43% to 536,000 CNY/ton, and ammonium paratungstate prices increased by 12.06% to 790,000 CNY/ton [30] - Supply is tightening due to reduced mining quotas and slower production rates, while domestic demand remains stable [30] Tin - SHFE tin prices increased by 21.85% to 429,600 CNY/ton, and LME tin prices rose by 21.73% to 54,200 USD/ton [33] - Supply disruptions from key mining regions and strong demand from traditional and emerging sectors are driving price increases [33] Antimony - Antimony ingot prices rose by 1.26% to 160,500 CNY/ton, and antimony concentrate prices increased by 1.42% to 142,500 CNY/ton [42] - The supply remains tight, and demand is expected to decline as the market approaches the Lunar New Year [42]

- The report focuses on the "CSI Nonferrous Metal Mining Theme Index," which selects 40 listed companies with nonferrous metal mineral reserves as index samples, reflecting the overall performance of nonferrous metal mining-themed listed companies. The index emphasizes upstream mining companies due to their higher profit elasticity and direct benefits from metal price increases. The index is designed to capture the value of upstream resource enterprises and is suitable for investors optimistic about resource cycle trends[27][28][32] - The index adopts a balanced strategy for selecting constituent stocks. It first excludes the bottom 10% of low-liquidity stocks based on daily trading volume, then selects the top three securities from each CSI fourth-level industry based on market capitalization rankings over the past year. If fewer than three securities are available, all are included. Remaining samples are added based on market capitalization rankings until the total reaches 40 stocks. This ensures representation across various resource categories, including gold, aluminum, rare earths, cobalt, lithium, and other strategic metals. The index is adjusted semi-annually in June and December[28][32] - The index's constituent stocks are distributed across four major sectors: industrial metals, energy metals, precious metals, and strategic small metals. This structure aligns with high-demand downstream industries such as new energy, AI computing power, power infrastructure, and semiconductors, enabling precise capture of core investment opportunities across the entire industry chain[7][32][40] - The index's market capitalization distribution is concentrated in large-cap stocks, with 55.61% of the weight allocated to stocks with a market capitalization above 1 trillion RMB. Mid-cap stocks (200-1000 billion RMB) account for 43.09% of the weight, providing effective support. This structure avoids risks associated with small-cap stocks while leveraging the resource barriers of large-cap leaders and capturing growth opportunities in niche sectors[41][46] - The index demonstrates strong performance across various timeframes. Over the past year, its return reached 120.35%, significantly outperforming major broad-based indices like the CSI 300 (24.58%) and the Shanghai Composite Index (27.13%). It also surpassed industry indices such as the SW Nonferrous Metals Index (107.58%). In the medium term, its six-month return was 95.59%, and its three-month return was 28.48%. Short-term performance was equally impressive, with a one-month return of 24.06%[59][62][64]

Core Insights - The report highlights a bullish outlook for the metals sector, driven by macroeconomic factors such as the Federal Reserve's interest rate cuts and a recovering global economy, particularly in China [3][44] - Key investment themes for 2026 include expanding demand for precious metals like gold and silver, improving fundamentals for aluminum and copper, strategic opportunities in rare earths, and supply-side disruptions due to overcapacity in certain sectors [3][4] Group 1: Precious Metals - The report suggests a long-term bullish view on gold, with expectations of price increases driven by anticipated interest rate cuts and geopolitical tensions, which enhance gold's appeal as a safe-haven asset [3][44] - Silver is also highlighted as a key investment opportunity due to its high price ratio to gold, indicating potential for significant price appreciation [3] - Specific companies to watch include Shandong Gold (600547.SH) and Zijin Mining (601899.SH), which are expected to benefit from increased production and operational efficiencies [4] Group 2: Industrial Metals - The report notes that aluminum and copper are set to see improved profitability due to lower production costs and increased demand, particularly in the context of infrastructure investments [3][4] - Companies such as Zhongfu Industrial (600595.SH) and Zijin Mining (601899.SH) are identified as having strong positions in the copper market, with expected profit growth [4] - The report emphasizes the importance of monitoring supply chain dynamics, particularly in copper, where inventory levels are shifting significantly [18][58] Group 3: Rare Earths and Strategic Metals - The report identifies rare earth elements as a critical area for investment, particularly in light of geopolitical tensions between the US and China, which may create opportunities for companies involved in rare earth mining and processing [3][4] - Companies like Northern Rare Earth (600111.SH) and China Rare Earth (000831.SZ) are highlighted for their potential to benefit from price increases in rare earth materials [4] Group 4: Energy Metals - The report discusses the rebound in lithium and nickel prices, driven by strong demand from the battery sector, with specific mention of companies like Tianqi Lithium (002466.SZ) and Ganfeng Lithium (002460.SZ) [4][27] - The expected growth in energy storage solutions is also noted as a significant driver for demand in these metals [4] Group 5: Overall Market Performance - The overall performance of the non-ferrous metals sector is noted to have outperformed the broader market, with a cumulative increase of 96.46% in 2025 compared to a 21.65% increase in the Shanghai Composite Index [33][35] - The report indicates that while the sector has seen significant gains, valuations are currently at historical averages, suggesting potential for further growth [35]

Core Insights - The China Securities Sub-Industry Nonferrous Metals Theme Index (000811) has seen a strong increase of 2.55% as of January 23, 2026, with notable gains in constituent stocks such as Huafeng Aluminum (up 10.00%), Silver Nonferrous (up 9.97%), and Tongling Nonferrous (up 9.94%) [1] - The Nonferrous Metals ETF (516650) rose by 2.75%, reaching a latest price of 2.24 yuan, and has accumulated a 1.16% increase over the past week [1] - The Nonferrous Metals ETF has experienced continuous net inflows over the past 21 days, totaling 11.807 billion yuan, with the latest share count reaching 7.224 billion and total assets at 15.773 billion yuan, both marking new highs since inception [1] - Over the past two years, the net value of the Nonferrous Metals ETF has increased by 169.74%, ranking 35th out of 2,515 index equity funds, placing it in the top 1.39% [1] - The ETF has recorded a maximum monthly return of 27.00% since inception, with the longest consecutive months of increase being 6 months and the highest cumulative increase being 69.57%, averaging a monthly return of 9.76% during rising months [1] Index Composition - As of December 31, 2025, the top ten weighted stocks in the Nonferrous Metals Theme Index include Zijin Mining, Luoyang Molybdenum, Northern Rare Earth, Huayou Cobalt, China Aluminum, Ganfeng Lithium, Shandong Gold, Yun Aluminum, Zhongjin Gold, and Tianqi Lithium, collectively accounting for 52.98% of the index [2] Stock Performance - The performance of key stocks within the index includes: - Zijin Mining: -0.13% with a weight of 15.30% - Luoyang Molybdenum: +0.13% with a weight of 7.92% - Northern Rare Earth: +0.44% with a weight of 5.30% - Huayou Cobalt: +5.38% with a weight of 4.69% - China Aluminum: -0.45% with a weight of 4.39% - Ganfeng Lithium: +5.63% with a weight of 3.23% - Shandong Gold: +0.87% with a weight of 3.18% - Yun Aluminum: -0.24% with a weight of 3.11% - Zhongjin Gold: +2.88% with a weight of 3.08% - Tianqi Lithium: +3.54% with a weight of 2.60% [3]

据生意社监测，氧化镨01月22日最新价格675000.00万元/吨，最近10天上涨6.72%，15天上涨10.20%， 20天上涨13.92%，30天上涨14.89%，60天上涨20.00%。 相关生产商有：北方稀土(600111)中色股份(000758)中国稀土(000831)盛和资源(600392)等。 相关生产商有：北方稀土(600111)中色股份(000758)中国稀土(000831)盛和资源(600392)等。 据生意社监测，氧化镨01月22日最新价格675000.00万元/吨，最近10天上涨6.72%，15天上涨10.20%， 20天上涨13.92%，30天上涨14.89%，60天上涨20.00%。 ...

Core Viewpoint - The non-ferrous metal sector is experiencing a strong rally, with the popular ETF, Huabao Non-Ferrous ETF (159876), reaching a historical high and significant trading volume, indicating potential investment opportunities [1][11]. Group 1: Market Performance - The non-ferrous metal sector has shown a robust performance, with the Huabao Non-Ferrous ETF (159876) rising by 3.29% and achieving a trading volume of 1.07 billion yuan, surpassing the previous day's total [1][9]. - Major stocks in the sector, such as Baiyin Non-Ferrous and Tongling Non-Ferrous, have seen significant gains, with Baiyin Non-Ferrous up by 9.97% and Tongling Non-Ferrous by 9.94% [2][14]. - The overall market sentiment is positive, with the non-ferrous metal sector leading among 31 primary sub-industries in the A-share market [5][13]. Group 2: Gold Price Surge - International gold prices have surged, with spot gold reaching 4,950 USD per ounce, marking a new historical high, while COMEX gold futures peaked at 4,970 USD per ounce [2][10]. - The rise in gold prices is attributed to factors such as geopolitical tensions, U.S. risks, and central bank gold purchases, which are expected to support gold prices in the future [3][13]. Group 3: Investment Trends - The Huabao Non-Ferrous ETF has seen a net subscription of 52.2 million units, accumulating 844 million yuan over the past 20 days, indicating strong investor interest [1][11]. - The ETF covers a wide range of metals, including copper, aluminum, gold, rare earths, and lithium, allowing investors to capture various market cycles [6][16]. - Analysts predict that the demand for basic metals like copper, aluminum, and tin will continue to perform well due to emerging needs in AI, electricity, and new energy sectors [3][13].