Rare Earth Ore Prices Edge Up in China as Northern Rare Earth and Bao Gang Adjust Q2 Rates

Highlights

• China’s rare earth ore transaction price rises 1.11% to 18,825 yuan per metric ton in Q2 2025.
• Pricing mechanism includes a variable adjustment of 376.5 yuan per ton for every 1% change in REO content.
• The pricing shift could impact global clean energy and defense supply chains due to China’s dominant market position.

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China Northern Rare Earth Group and Bao Gang United Steel have announced a 1.11% quarter-over-quarter increase in their rare earth ore transaction price for Q2 2025, signaling steady upward price pressure in one of the world’s most tightly controlled rare earth markets.

Effective immediately, the new transaction price is set at 18,825 yuan per metric ton (dry weight, REO=50%), up 207 yuan per ton from Q1 2025’s level of 18,618 yuan. The pricing adjustment, approved during Northern Rare Earth’s 6th general manager’s office meeting of 2025, reflects ongoing recalibrations under the company’s ore pricing methodology, which links ore prices to prevailing rare earth oxide (REO) market values.

Additionally, Shanghai Metals Market (opens in a new tab) reports that the announced pricing formula includes a variable adjustment mechanism: for every 1% change in REO content, the price will increase or decrease by 376.5 yuan per ton (tax-exclusive). This signals a continued focus on ore quality and introduces further price responsiveness based on raw material composition.

What’s Not Covered

The announcement does not clarify which specific oxide benchmarks were used in the Q1 calculation, nor does it disclose volume commitments or how the price shift may affect downstream separation facilities, magnet manufacturers, or export pricing. Market observers will be watching closely for follow-up impacts on NdPr pricing and whether this reflects broader inflationary trends in China’s resource sector or a targeted margin adjustment.

As China remains the dominant global supplier of rare earths, such incremental shifts in state-controlled pricing mechanisms can reverberate across global clean energy and defense supply chains. The move could also shape trade negotiations and pricing benchmarks for global REE producers seeking parity or protection.