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| Rare Earth Recycling |
Shrinking Magnet Scrap and Declining Margins Weigh on Recycling Sector
China’s recycled rare earth oxide (REO) output fell by 14% in 2024, marking a rare contraction in the country’s otherwise dominant position in the global rare earth recycling market. According to Ji’an Xintai Technology chairman Liu Weihua, REO recovery from NdFeB magnet scrap totaled 34,147 tonnes, down from 39,662 tonnes in 2023, but still slightly above 2022 levels.
The recycled output included 26,504 tonnes of praseodymium-neodymium oxide, with smaller volumes of gadolinium, terbium, dysprosium, and holmium. This downturn reflects the growing stress on China’s secondary rare earth supply chain, which is facing both input scarcity and market price volatility.
Magnet Manufacturing Trends Disrupt Scrap Flow
The primary cause of the decline was tightened availability of NdFeB magnet scrap, a result of technology upgrades among large magnet producers. These efficiency improvements have reduced offcuts and scrap generation. Simultaneously, traders have withheld material amid low spot prices, further tightening the scrap supply pipeline.
On the processing side, slim margins have forced some recycling facilities to scale back operations. Firm scrap prices and falling REO selling prices have compressed profitability across the sector. In response, many magnet producers have internalized recycling, developing in-house systems to boost resource recovery and cost control.
Jiangxi Province Leads Recycling Output, National Capacity Still Expanding
China operates about 40 rare earth recycling plants, with Jiangxi province contributing a commanding 64% of national output. Shandong and Jiangsu follow with 15% and 11%, respectively. Together, these three provinces account for more than 86% of China’s REO recycling capacity.
While 2024 saw a setback, China’s annual REO recycling capacity still surpassed 80,000 tonnes, and is projected to exceed 100,000 tonnes in 2025. Global REO production reached 454,000 tonnes in 2024, with China maintaining a 90% market share through a combination of domestic mining, recycling, and strategic imports.
ScrapInsight Editorial Commentary
This year’s dip in China’s REO recycling underscores the fragility of scrap-based supply chains under current economic and operational constraints. Yet, China’s long-term dominance remains intact due to its scale, infrastructure, and strategic focus. To avoid volatility, global consumers may increasingly seek geographic diversification and support circular innovations in rare earth recovery.
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