智通财经网·2025-08-25 09:31Core Viewpoint - The report from Guotai Junan maintains an "overweight" rating for the rare earth industry, highlighting that the implementation of new regulations will lead to significant supply constraints in the domestic market, which is expected to accelerate market dynamics [1]. Supply Constraints - The new management measures specify that only enterprises designated by the Ministry of Industry and Information Technology (MIIT) and the Ministry of Natural Resources can conduct smelting and separation, incorporating imported ores into regulation. This change may lead to the exit of some small and medium-sized smelting and separation enterprises, resulting in substantial supply constraints in the domestic market [1]. Smelting Fees and Asset Revaluation - According to Baichuan Yingfu data, the processing fee for heavy rare earth ore has surged from 0.15 million yuan per ton to 1.35 million yuan per ton since early August. As of August 19, 2025, the theoretical net profit for smelting and separation is estimated at around 14,000 yuan per ton, an increase of nearly 20,000 yuan per ton compared to the beginning of the year. The potential establishment of a whitelist for smelting and separation may further concentrate production capacity among larger groups, leading to an extension of smelting profits and a revaluation of smelting assets [2]. Price Dynamics and Market Sentiment - The company believes that with the upcoming peak season for electric vehicles, there is strong replenishment demand from domestic and international enterprises, which is driving a rapid increase in rare earth prices. The implementation of the new management measures is expected to catalyze both supply and sentiment, maintaining strong upward momentum for rare earth prices, with a focus on medium and heavy rare earth smelting and separation enterprises [3].