Rare earth magnetic materials: carbon neutralization drives demand growth
Table of Contents
- Different from the market
- Basic classification of motor
- Main application of permanent magnet motor
- Development process of rare earth magnetic materials
- Properties of different permanent magnets
- Influence of permanent magnet performance and shape on motor performance
- Metallurgical production of sintered Nd-Fe-B magnet powder
Benefiting from carbon neutralization, demand for NdFeB magnets will accelerate
- After 2015, the output of rare earth permanent magnets in China increased steadily
- The export volume of NdFeB permanent magnet accounts for about 30%
- The rise of new energy demand under the trend of carbon neutral promotes a new round of rapid growth of rare earth magnetic materials
- The demand of automobile industry is relatively large
- Demand for new energy vehicles continues to increase
- Broad development space of wind power driven by carbon neutralization
- Energy saving elevator and frequency conversion air conditioner are expected to speed up penetration
- Consumer electronics high end NdFeB returns to growth
- Permeability improvement of high performance vibration motor
The price of rare earth materials tends to be stable, and the proportion of heavy rare earth decreases with technological progress
- In the second half of 2020, the price of rare earth will increase greatly
- Rare earth production is expected to increase steadily
- Domestic rare earth ore and smelting separation volume is expected to increase steadily in 2021
- In April 2021, the price of rare earth tends to be stable, and the cost pressure of magnetic materials gradually decreases
- Leading manufacturers have relatively strong ability to conduct costs and stable profitability
For the permanent magnet with excellent parameters, high cost performance and the best comprehensive quality, the use of sintered NdFeB magnet can greatly reduce the use of magnetic materials, reduce the volume and weight of the motor, and greatly improve the power mechanical energy conversion efficiency, which is more than 10% – 15% higher than that of ordinary permanent magnet. The accelerated penetration of NdFeB permanent magnet is conducive to energy saving and carbon emission reduction. In addition to the power consumption of electric smelting, 80% – 90% of domestic power is consumed by motor; In 2020, the implementation of new energy efficiency standards for variable frequency air conditioning will greatly accelerate the penetration of NdFeB permanent magnet in variable frequency air conditioning. In the future, driven by the domestic carbon peak and carbon neutral policy, energy efficiency standards will be raised in more fields, and the improvement of motor standards will become the most important part.
Carbon neutral policy will accelerate the penetration of NdFeB permanent magnets.
NdFeB permanent magnet has obvious advantages in energy saving, which will promote carbon neutralization in two aspects. On the one hand, the energy efficiency of NdFeB permanent magnet motor is high, and the increase of its permeability will reduce the power consumption. On the other hand, NdFeB permanent magnet will help the development of new energy. More than 40% of wind turbines use NdFeB permanent magnet, which will help the development of clean energy; At the same time, neodymium iron boron permanent magnet is mainly used in the drive motor of new energy vehicles, which is conducive to reducing the use of fossil energy and carbon emissions in the future.
New energy vehicles will become the main demand growth field of NdFeB permanent magnets.
2020 is the first year driven by the marketization of new energy vehicles. The production and sales of new energy vehicles grow rapidly in the second half of the year. The global sales volume is 3.24 million vehicles, and the demand for NdFeB permanent magnets is about 11500 tons. In the next five years, the progress of new energy vehicles will accelerate to the penetration stage. We expect that the global sales of new energy vehicles will increase to more than 15 million from 2021 to 2025, with a compound annual growth rate of more than 35%; The demand for NdFeB will reach more than 56000 tons, and the domestic demand will reach about 24000 tons, becoming the most important consumption field of NdFeB permanent magnets.
The price of rare earth tends to be stable, and the cost of magnetic materials meets the inflection point.
This round of rare earth prices rose rapidly driven by demand from May 2020 to February March 2021; Subsequently, due to the cost pressure of downstream, the price of rare earths dropped. Rare earth elements account for 60% – 75% of the production cost of NdFeB permanent magnets. The rising price of rare earth causes the production cost to rise by more than 60%, while the price of NdFeB magnets only rises by 30% – 40%. We believe that the price of rare earth may stabilize in the future. At the same time, China will increase the quota of rare earth mining in 2021, and the annual quota is expected to increase by more than 25%, which will relieve the pressure of rare earth supply to a certain extent. The transmission cycle of rare earth price to the production cost of magnetic material manufacturers is about one quarter. The period from January to February 2021 is expected to be the stage with the greatest cost pressure on magnetic material manufacturers, and may to June will usher in an inflection point. Therefore, we are optimistic about the recovery of the profitability of magnetic material manufacturers in the second half of the year. Since the second half of 2017, the share prices of rare earth magnetic material manufacturers have been fluctuating at the bottom. We expect that with the recovery of profitability, the share prices are also expected to rebound.
Different from the market
The market believes that the profitability of rare earth magnetic materials is expected to decline significantly due to the cost side pressure. We believe that the manufacturers with the advantages of technology, production capacity and key customers can better control the cost and conduction cost. On the one hand, the leading enterprises can reduce the doping amount of medium and heavy rare earths and reduce the comprehensive production cost through technological progress; on the other hand, they can share the cost with customers through the advantages of production capacity and scale, and the output growth will correspondingly dilute the fixed cost and maintain the relatively stable profitability. In the third and fourth quarter of 2020, the main companies of rare earth magnetic materials will keep their gross profit rate rising steadily. The long-term sharp rise of rare earth price is not conducive to the reasonable development of the whole industrial chain, and keeping in a reasonable price range is conducive to the penetration of downstream fields; We believe that the current stage of the fastest rising rate of rare earth prices has ended, and it is expected to stabilize after the correction in April. Therefore, the stage of the greatest cost pressure on NdFeB magnetic materials may be in the 1ST-2ND quarter of 2021, and it is expected to usher in the turning point of profit from May to June.
The market thinks that the average demand of rare earth magnetic materials for new energy vehicles may decrease, and even if the sales volume is large, the incremental contribution of rare earth magnetic materials is limited. We believe that electric vehicles will develop in a bipolar way in the future. Both low-end and high-end products will maintain rapid growth. Low end electric vehicle products may have less demand for magnetic materials, but high-end products adopt high torque, high-power motors or even dual motors, which will double the demand for rare earth magnetic materials. In the future, the emission reduction standards of traditional vehicles will be accelerated, more small and micro motors will adopt high-end NdFeB magnet motors, and the demand for single traditional vehicles will also maintain a growth trend.
The market thinks that the rare earth magnetic material industry is essentially a processing enterprise, and the overall profitability and elasticity are insufficient. We believe that the rare earth magnetic material industry is an industry with high technology content, high management ability and high cost control ability, and the enterprises with advantages in this aspect can obtain excess profits. At the same time, the position of the industry chain of the magnetic material industry makes it difficult to obtain a higher profit margin, but the expansion of production capacity and the increase of added value of high-end products will support the rapid growth of the performance of the industry companies. At the present stage, the industry has entered a new round of demand driven capacity expansion. We expect that the leading manufacturers will maintain a good growth capacity in the next five years.
The market believes that the substantial expansion of manufacturers’ capacity may lead to overcapacity in the future. We believe that the continuous high growth of downstream demand can digest the current planned capacity. The increment of production capacity mainly comes from leading manufacturers. At present, the total planned blank production capacity is about 80000 tons / year. According to our calculation, only the demand increment of main motor of new energy vehicles corresponds to the blank volume of about 40000 tons / year, and energy-saving air conditioning will contribute more than 10000 tons / year of blank demand increment in the future; In addition, the steady growth of new wind power installed capacity and the demand substitution of traditional industrial motors can fully absorb the current planned capacity growth.
Basic classification of motor
Motor is the main equipment to realize the mutual conversion of electric energy and mechanical energy based on the principle of electromagnetism and electromagnetism. It can be divided into DC motor and AC motor according to the form of current. It can be divided into permanent magnet motor and electric excitation motor according to the form of magnetic field. It can be divided into synchronous motor and asynchronous motor according to the phase of rotor motion and magnetic field (current); The types of motors that need to use permanent magnet include DC permanent magnet motor and AC permanent magnet synchronous motor.
Divided by input current
1) DC motor
Principle: the input current is DC, through the brush and commutator to make the motor rotor continuously get the same direction of current.
Advantages: DC motor has wide range of speed regulation, smooth speed regulation characteristics, strong overload capacity, large starting and braking torque.
Disadvantages: because the brush is easy to wear, so the motor life is not high; And the power of DC motor is relatively small.
2) AC motor
Principle: the input current is AC, the electromagnet is used to replace the permanent magnet, the AC signal is loaded on the motor stator to generate the rotating magnetic flux potential, so that the motor winding continuously cuts the magnetic line of force to generate the field force.
Advantages: high service life, high power, not easy to damage by the impact of large current, cooling and braking are more convenient.
Disadvantages: low precision, poor speed regulation performance.
By control mode
1) Conventional motor
Principle: analog input, that is, the armature winding is directly electrified. The control of the motor completely depends on the control of the input current and voltage.
Advantages: low price, simple control circuit, high power.
Disadvantages: low precision, rough speed regulation curve.
2) Stepping motor
Principle: stepping motor is a kind of actuator which converts electric pulse into angular displacement. Generally speaking: when the stepper driver receives a pulse signal, it drives the stepper motor to rotate a fixed angle (and stepper angle) in the set direction. The angular displacement can be controlled by controlling the number of pulses, so as to achieve the purpose of accurate positioning; At the same time, the speed and acceleration of the motor can be controlled by controlling the pulse frequency, so as to achieve the purpose of speed regulation.
Advantages: due to the digital input, the motor precision has been greatly improved, the speed and acceleration control is easy to achieve, and the control effect is good. Disadvantages: poor performance at high speed, complex controller driver circuit and large volume. The price is higher than that of traditional motors.
3) Servo motor
Principle: servo motor, also known as executive motor, is divided into DC and AC servo motors. The rotor inside the servo motor is a permanent magnet. The U / V / W three-phase electricity controlled by the driver forms an electromagnetic field, and the rotor rotates under the effect of the magnetic field. At the same time, the encoder of the motor feeds back the signal to the driver, and the driver compares the feedback value with the target value, Adjust the rotation angle of the rotor. The accuracy of servo motor depends on the accuracy of encoder (number of lines).
Advantages: because the servo motor with motor encoder forms an inner closed loop, so the control precision is very high, and it can operate normally at high speed. The driver can communicate with the host computer directly.
Disadvantages: high price, long supply cycle of imported goods, high maintenance costs.
Divided by commutation mode
1) Brush motor
Principle: the principle of motor brush is similar to that of slip ring. DC motor transmits DC power to the winding through brush. The existence of brush makes the motor not winding in the process of rotation. A motor with a brush is called a brush motor.
Advantages: low cost, simple structure, large starting torque, wide speed range, easy control,
Disadvantages: the brush needs to be replaced regularly, the motor life is short, and the power curve is nonlinear.
2) Brushless motor
Principle: the electric signal is loaded on the stator of the motor, and the magnetic poles are placed on the rotor, so that the motor does not have the winding problem, thus eliminating the brush, that is, brushless motor.
Advantages: brushless motor without brush, friction is greatly reduced, running smoothly, noise will be much lower, and life is higher.
Disadvantages: brushless motor needs external control circuit (brushless DC), the control is more complex, and the cost is higher.
Divided by motor shape
1) Column motor
Principle: column is the basic shape of the motor, whether traditional motor, stepper motor or servo motor, most of the shape is column.
Advantages: high torque, high power density, energy saving.
Disadvantages: in some cases, limited by installation conditions, poor heat dissipation, torque ripple compared with disc motor.
2) Disc motor
Principle: the internal structure is similar to the column motor, which adopts the coreless armature structure, with flat shape and short axial dimension.
Advantages: suitable for thin installation, good reversing performance, suitable for frequent starting brake steering occasions, good heat dissipation, no torque ripple.
Disadvantages: compared with the column motor, the torque is smaller and the power density is smaller, so it is not suitable for high-power applications.
Torque motor is a kind of special motor with soft mechanical characteristics and wide speed range. The shaft of this kind of motor does not output power by constant power, but by constant torque. When the load torque increases, it can automatically reduce the speed and increase the output torque. When the load torque is a certain value, the motor terminal voltage can be changed to adjust the speed.
Principle: open loop current control, internal resistance than ordinary motor, can adapt to locked rotor.
Advantages: low price, high torque, no damage to the motor when locked rotor, when the load torque increases, it can automatically reduce the speed and increase the output torque.
Disadvantages: no feedback, low control accuracy, unable to stop at a precise position without adding peripherals.
1. In terms of cost
Traditional motor < stepping motor < servo motor
2. Considering from the requirements of motor speed
The traditional motor speed range is wide, but the speed is not accurate and smooth, and with the decrease of speed, the power will decrease, and the torque will decrease; Stepper motor has more stringent requirements on speed. When the speed is too low, there will be shaking and crawling. When the speed is high, the torque will be greatly reduced, so stepper motor is only suitable for medium speed operation. Servo motor has obvious advantages in speed, and basically has no obvious weakness.
3. Considering from the control accuracy
The precision of traditional motor can not be guaranteed because it is controlled by analog quantity. Stepping motor and servo motor are controlled by digital signal, and their precision is much higher than that of traditional motor. However, the inner closed-loop control of servo motor with encoder can effectively reduce step dropping, and the step angle of servo motor is usually much smaller than that of stepping motor, so the precision is higher.
Main application of permanent magnet motor
Compared with electrically excited motor (including DC motor and AC motor), permanent magnet motor has the characteristics of simple structure, small volume, light weight, high reliability, low loss and high efficiency. It has penetrated into the whole industrial system and is widely used in industrial drive, agricultural production, aerospace, automobile, household appliances, medical equipment, electronic products and other fields. As a representative of high-end permanent magnet materials, NdFeB permanent magnet is widely used in the field of medium and high-end permanent magnet motors. In many application scenarios where high performance, high precision and high efficiency motors are needed, NdFeB permanent magnet motors (DC or AC) can be used.
DC permanent magnet motor: driven by DC power supply, using permanent magnet instead of electric excitation, it is mainly used in low and medium power applications that can stably provide DC power, including electric bicycles, electric motorcycles, scooters and electric vehicles that have developed rapidly in recent years; In addition, the vehicle steering power (EPS), igniter also uses DC permanent magnet motor.
AC synchronous permanent magnet motor: it is a kind of AC motor with rapid development in recent years. It has the advantages of high power factor, high efficiency and less heat. It is a kind of energy-saving motor with broad development prospect, so it can quickly replace the common AC asynchronous motor. The stator of asynchronous starting permanent magnet synchronous motor is the same as that of traditional AC asynchronous motor, the difference is that the excitation coil is replaced by permanent magnet on the rotor. At present, some high-end electric vehicle models use AC synchronous motor, such as BYD Han, etc. in the future, AC synchronous permanent magnet motor will be accelerated in electric vehicles.
Development process of rare earth magnetic materials
Rare earth magnetic materials have experienced three generations of development, and now the fourth generation is in the research and development stage.
Permanent magnet (hard magnet) is a kind of material which is difficult to demagnetize after magnetization. At present, the main permanent magnet materials include ferrite permanent magnet, metal permanent magnet and rare earth permanent magnet. The rare earth permanent magnet material (SmCo5) was invented in the 1930s and industrialized in the 1960s, and quickly became the most important permanent magnet material at that time.
Rare earth permanent magnet materials mainly include NdFeB permanent magnet (the third generation of rare earth permanent magnet), SmCo permanent magnet (the first and second generation of rare earth permanent magnet), rare earth iron carbon (Re-Fe-C system) and rare earth iron nitrogen (Re-Fe-N system). At present, NdFeB permanent magnet is one of the most widely used, excellent performance and cost-effective permanent magnet materials, Occupy most of the market space in the field of high-end magnetic materials; SmCo permanent magnet is mainly used in high temperature environment (250 ℃ – 350 ℃) because of its high cost, low iron content and low oxidation resistance; Rare earth iron carbon (Nitrogen) permanent magnet is a new generation of system permanent magnet in the future.
Properties of different permanent magnets
Compared with SmCo rare earth permanent magnet materials, the proportion of rare earth metals in NdFeB permanent magnet materials is relatively low, with neodymium (praseodymium) accounting for 29% ~ 32.5%, iron accounting for 64% ~ 69%, and boron accounting for 1.1% ~ 1.2%. In addition, some types of products need to be doped with heavy rare earth elements such as dysprosium, terbium, niobium, copper, etc. The cost of samarium cobalt rare earth permanent magnet is mainly cobalt. The second generation of rare earth permanent magnet Sm2Co17 accounts for about 50% (48% – 52%), rare earth element samarium accounts for 23% – 28%, and iron accounts for 14% – 17%. The proportion of cobalt with high price in SmCo permanent magnet is about 1.7 times that of praseodymium and neodymium in NdFeB permanent magnet. Therefore, the price of SmCo permanent magnet is higher than that of NdFeB permanent magnet when most rare earth prices remain stable. In addition, the properties of sintered NdFeB magnets are much better than SmCo magnets, and the remanence, coercivity and maximum energy product of sintered NdFeB magnets are higher than SmCo magnets. However, the Curie temperature (TC) of NdFeB permanent magnet is relatively low, only 310-510 ℃, which is lower than 700-800 ℃ of SmCo permanent magnet. Therefore, the working temperature of NdFeB is usually below 150 ℃ (which can meet most downstream application temperature), and SmCo permanent magnet can be applied to the temperature above 250 ℃. Therefore, it is mainly used in high temperature working environment at present.
Nd-Fe-B permanent magnet is the best permanent magnet material with the best comprehensive performance. According to the production process, it can be divided into sintered Nd-Fe-B, bonded Nd-Fe-B and hot pressed Nd-Fe-B. among them, sintered Nd-Fe-B permanent magnet is the most widely used and its output accounts for more than 95%. Bonded NdFeB can produce thin-walled parts, special-shaped parts and other products because it does not need sintering and the subsequent machining is relatively simple, which can make up for the application direction that some sintered products are difficult to meet, but its performance is weaker than that of sintered NdFeB. High performance NdFeB magnets are prepared by hot isostatic pressing, which have the same magnetic properties as sintered NdFeB magnets without adding heavy rare earth elements of Dy and TB, and have good compactness, corrosion resistance, orientation and magnetic properties; The main disadvantages are relatively high cost, slightly poor mechanical performance, patent monopoly and so on. At present, it is mainly used in Automotive EPS motor direction.
Influence of permanent magnet performance and shape on motor performance
The magnetic properties of NdFeB permanent magnet directly affect the performance of motor. Remanence, coercivity (intrinsic coercivity), maximum magnetic energy product and Curie temperature are the most important properties of NdFeB magnet. The remanence index is the maximum magnetic flux that the magnet can provide without external magnetic field after magnetization. The larger the remanence index is, the higher the air gap magnetic density is, and the higher the maximum torque and efficiency point are; Coercivity is a parameter that indicates the ability of magnet to resist demagnetization. The larger the coercivity is, the smaller the thickness of magnet will be and the stronger the ability to resist overload will be; The maximum magnetic energy product is the maximum magnetic energy that the magnet can provide. The higher the value is, the less magnets will be used under the same power. Curie temperature TC is the temperature at which the magnetism of the magnet disappears, indicating the temperature range in which the magnet can work; And the temperature coefficient α If it is a magnet, it represents the percentage of reversible change of the magnet’s magnetism with the change of temperature. These two indexes are the temperature indexes that need to be considered when using magnetic materials.
In addition, the shape of the magnet also has a great impact on the performance of the motor. The shape conditions such as the thickness, width and chamfer of the permanent magnet can not only affect the efficiency of the magnet, but also affect the accuracy of the magnet mechanical installation and the vibration in use, and ultimately affect the efficiency and cost of the motor. When the external magnetic circuit of the motor is fixed, the increase of the magnet thickness can reduce the air gap and improve the efficiency of the motor, but it will lead to the commutation vibration of the motor. If the square magnet is not chamfered, the change rate of magnetic field will be large and the pulsation of motor will be caused. The larger the chamfering is, the smaller the pulsation is; However, chamfering results in less flux.
High performance NdFeB permanent magnet can improve the performance of large amplitude motor
High performance NdFeB permanent magnet has high magnetic performance index, high remanence and high coercivity, which can improve the power conversion efficiency of the motor, produce large torque at low speed and high power coefficient; At the same time, it can reduce the volume of magnet and motor, reduce the volume of equipment, facilitate maintenance, save other raw materials and so on. High performance Nd-Fe-B motor has small magnetic loss, which leads to high power conversion efficiency and low heat output. The high magnetic flux and energy product of high-performance NdFeB can greatly improve the accuracy and sensitivity of motor control, and the speed range can be greatly improved to more than 1000:1, which makes the motor start more smoothly and control more accurately, and the loss of frequent start and speed change is small. Therefore, the high-performance NdFeB magnet can greatly save energy. Compared with the ordinary NdFeB magnet, it can further reduce the energy consumption of more than 5 pct, and the average energy-saving efficiency can reach more than 15%. It can save 25% – 30% energy in the application fields such as frequency conversion air conditioning, elevator and so on, which need frequent start-up and stop, and change the working speed.
Metallurgical production of sintered Nd-Fe-B magnet powder
China’s NdFeB industry has completed technology accumulation and is in the period of accelerating technological innovation.
Sintered NdFeB magnets are produced by powder metallurgy process. There are about 16 main production steps. Raw material preparation (magnetic powder type, raw material cost), sintering process, surface treatment, annealing and post-treatment all greatly affect the performance of magnets. These main links are also the main direction of rapid progress in China’s NdFeB permanent magnet industry.
First of all, in terms of magnetic powder preparation and raw material ratio, China has successively broken through the processes of hydrogen explosion and double alloy ratio, which solved the internal problems of smelting NdFeB ingot due to the reduction of rare earth element ratio in the traditional NdFeB sintering process α- Fe precipitation leads to the decrease of Nd2Fe14B content, which affects the subsequent milling, sintering and post-treatment, and then leads to the decrease of intrinsic coercivity. The main alloy with composition close to Nd2Fe14B and the auxiliary alloy with rich neodymium are used in the double alloy process, which are eliminated after annealing α- Fe phase. Through the ratio of raw materials and the back-end treatment process, the proportion of rare earth elements in the magnet can be reduced, the production cost can be reduced and the performance of the magnet can be improved.
Moreover, Chinese manufacturers have made great progress in the back-end processing and surface treatment of NdFeB magnets. Because the shape of the magnet has a great influence on the performance of the magnet, the rigidity and toughness of the superimposed sintered NdFeB magnet are relatively poor, so it can only cut the simple shape. At present, China has achieved catch-up in blank forming, back-end wire cutting and production line automation. Nd-Fe-B is easy to oxidize due to its high iron content, so it needs surface treatment. This process is also the biggest gap between China and high-end products such as Japan and Germany; At present, China has basically completed the replacement of iron boron products requiring high performance surface treatment; After the breakthrough of surface treatment technology, the market share of Chinese manufacturers in high-end consumer electronics continues to grow.
Grain boundary penetration and other post-treatment processes have high technical barriers, which can improve the magnetic properties and mechanical properties of magnetic materials, reduce the doping amount of medium and heavy rare earth, and reduce the overall production cost. At present, in addition to bulk NdFeB magnets for wind power, other application products have been able to achieve efficient and high-quality grain boundary penetration, reducing the doping ratio of heavy rare earth from more than 5% to the current level of 1-2%, and it is expected to continue to reduce to 0.4-0.8% in the future, which is the world’s leading level.
China’s NdFeB industry chain tends to be diversified
China’s NdFeB rare earth permanent magnet industry chain is complete, with strong global competitiveness, and the industry chain mode tends to be diversified, intensive and efficient. In addition to the integrated large-scale NdFeB production enterprises, many small and medium-sized enterprises rely on large-scale enterprises, and through their own advantages in back-end processing technology and market segmentation, they can operate flexibly and become stronger. Domestic Nd-Fe-B enterprises have formed four bases, including Baotou with obvious advantages in raw materials, Ningbo with export and processing advantages, Beijing and Tianjin with rich R & D resources, and Pearl River Delta with large downstream demand and early start. Integrated large-scale manufacturers promote the continuous development of the industry through technology, capital, customer resources and other advantages. Technological progress and cost reduction of products promote the penetration of NdFeB permanent magnets into more fields. By purchasing raw materials (alloy powder), billets and even finished products for further processing, small manufacturers can meet the needs of small batch and customization, and make rapid response to the emergence and change of new demands. The two types of enterprises jointly promote the development and progress of the industry.
Benefiting from carbon neutralization, demand for NdFeB magnets will accelerate
After 2015, the output of rare earth permanent magnets in China increased steadily
Since the beginning of industrialization in the 1990s, the output of NdFeB permanent magnets in China has grown rapidly. Relying on the advantages of upstream raw materials and manufacturing capacity, the output of NdFeB permanent magnets in China ranked the first in the world around 2000, and maintained a growth rate higher than that of the global output and steadily increased the market share. According to the data of China rare earth Association, the output of permanent magnets in China’s system in 2019 is about 179000 tons, with a year-on-year growth rate of about 5%, and the compound growth rate in the past 10 years is 9%. The demand for NdFeB in the original main downstream fields has gradually transited from high-speed growth to growth. In terms of product types, the output of sintered NdFeB is 170000 tons, that of bonded NdFeB is 7900 tons, that of SmCo permanent magnet is about 2400 tons, and that of sintered NdFeB accounts for about 95% of the total output of rare earth permanent magnet.
There are three periods of high-speed growth in domestic NdFeB production. From 2002 to 2007, the rapid penetration of demand driven high growth. The domestic production increased rapidly from 17000 tons in 2003 to 50000 tons in 2007. The global financial crisis in 2008 led to a decline in production. In 2009-2011, due to the growth of domestic demand driven by the domestic economic stimulus plan, the output returned to growth, and in 2011, the output increased to about 90000 tons; However, due to the change of domestic policy, the price of rare earth increased by more than 10 times, and the high price affected the downstream demand, resulting in the rapid decline of output growth. In 2014-2015, with the price of rare earth falling to a relatively low level, the downstream suppressed demand gradually released, the growth of energy-saving elevators, wind power products and China’s automobile production all led to the recovery of demand in varying degrees, and the domestic demand for NdFeB magnets returned to medium and high-speed growth. After 2016, the price of rare earth remained at the bottom, the cost side no longer interfered with the demand, and the output of NdFeB permanent magnet entered the stage of steady growth.
The export volume of NdFeB permanent magnet accounts for about 30%
China has the most complete rare earth permanent magnet industry chain in the world, and is the most important producer of NdFeB permanent magnets in the world. In 2019, China’s output accounted for more than 85%. Other producers are Japan and Germany, with the output of 13900 tons and 6600 tons respectively. Therefore, China’s magnetic materials mainly meet the global demand through export and processing into motors. In 2019, China’s Nd-Fe-B magnetic products will reach 40700 tons, including 35300 tons of finished Nd-Fe-B products and 4982 tons of Nd-Fe-B alloy magnetic powder. In 2020, although affected by the epidemic, the export volume will return to above the normal level from the second quarter. In the whole year, the export of rare earth permanent magnet products will reach 40800 tons, which is basically the same as that of the previous year. Among them, the export of NdFeB permanent magnet products will reach 36000 tons, with a year-on-year increase of 2.0%; The export of rare earth magnetic powder and quick setting tablets decreased steadily, which was consistent with the declining trend of high-end export products, raw materials and semi-finished products. Since 2011, China’s export of NdFeB permanent magnets has maintained an overall growth trend, and the export growth has slowed down. On the one hand, it is related to the export in the form of processed motor and other end products; on the other hand, it is due to the decrease in the export quantity of low-end products and the increase in the export of high-end finished materials.
In terms of export amount and average export price, 2020 was basically the same as 2019. In the first half of 2020, the epidemic had a greater impact and led to lower prices. In the second half of 2020, the export amount and price increased rapidly, and the average export price of the whole year was 46.6 us dollars / kg. The export price of NdFeB permanent magnet is highly correlated with the price of rare earth, and the increase of high-end proportion also raises the overall export price to a certain extent.
In terms of export countries, domestic NdFeB permanent magnet exports are relatively concentrated, with the top five and top ten buyers accounting for 63% and 85% respectively in 2020; Among them, Germany, Japan and the United States are the top three countries, importing 5893 tons, 4928 tons and 4924 tons respectively, which is expected to exceed 5000 tons in 2021.
The rise of new energy demand under the trend of carbon neutral promotes a new round of rapid growth of rare earth magnetic materials
The application direction of sintered NdFeB permanent magnet is mostly in the field of high-performance small and medium-sized motor products, mainly including consumer electronics, energy-saving air conditioning, automobile motor, servo motor, etc; With the progress of motor design technology, some large and medium-sized motor products gradually adopt sintered NdFeB permanent magnet products, such as wind turbine generator, energy-saving elevator traction machine, military equipment, etc., while the performance of magnetic material is improved and the consumption is reduced. In the future, with the further improvement of magnetic material performance and the steady progress of high-end equipment, The usage of large NdFeB permanent magnet motors will continue to grow.
The industrial chain of NdFeB permanent magnet is relatively simple. The upstream is mainly made of rare earth raw materials, and the downstream is made of various types of motor products. The end products penetrate into the whole industrial system, and the main end products are consumer electronics, wind turbines, energy-saving air conditioning, energy-saving elevators, servo motors, automotive motors, etc. Consumer electronics, small motor for traditional automobile and other directions have high maturity and relatively slow growth; The new energy related direction will usher in a new round of growth under the accelerated penetration trend of electric vehicles and wind power.
China’s NdFeB permanent magnet production entered a new round of growth in 2015. NdFeB products are needed in all fields with high requirements for electromagnetic properties. Since 2015, China’s rare earth magnetic industry has maintained a large single digit growth, with a short decline in 2016 and a return to growth in 2017; In 2019, the domestic output of NdFeB blank will be 177900 tons, with a year-on-year increase of 9.5%; Among them, sintered NdFeB is about 170000 tons, up 9.7% year on year; 7900 tons of bonded NdFeB, with a year-on-year increase of 5%; However, hot pressed NdFeB is still in its infancy, and China’s first 300 t / a production capacity will be put into operation in Chengdu in 2018. According to the average yield of 70% from blank to finished product, the finished product output of NdFeB permanent magnet in 2019 is about 124500 tons. After deducting the export of NdFeB magnet, the domestic demand for finished product of NdFeB permanent magnet is about 80000 tons; It is estimated that in 2020, driven by the transfer of overseas orders and the demand of domestic wind power, energy-saving frequency conversion air conditioning and other fields, the domestic demand will grow by more than 10%.
In the downstream demand of NdFeB in 2018, traditional vehicles, new energy vehicles and industry ranked the top three, accounting for 37.5%, 11.8% and 10.9% respectively; Followed by wind power, consumer electronics, variable frequency air conditioning and energy-saving elevator, accounting for 10%, 9.1%, 9% and 8.4% respectively. In 2019, except for new energy vehicles, the main consumption areas will be affected by the macroeconomic downturn, and the demand will slow down. Although COVID-19 was hit by COVID-19 in 2020, global macroeconomic stimulus and loose liquidity policy have great impetus to the downstream area of NdFeB. Among them, the new energy vehicle has achieved rapid volume in the second half of the year, and the installed capacity of wind power has benefited from the rise in the market of price fixing. In addition to new energy vehicles, the production and sales of traditional vehicles have also rebounded to the bottom, achieving positive growth in a single month after April 2020. The traditional application fields such as electroacoustics and VCM are also growing against the trend. The frequency conversion air conditioning is one of the most obvious growth directions. The new domestic air conditioning energy efficiency standard will come into effect in July 2020. The use of NdFeB permanent magnet motor can meet the energy efficiency standard. The penetration rate of NdFeB permanent magnet in the air conditioning field will be greatly increased, and the demand in the air conditioning field is expected to grow by more than 50%.
The demand of automobile industry is relatively large
At present, the traditional automobile industry is still the largest consumption direction of NdFeB permanent magnet, accounting for about 30%, which is lower than the level of more than 35% in 2017-2018, mainly because the global automobile production will drop by more than 10% in 2020, and the demand of new energy vehicles, air conditioning and wind power will grow. Ordinary fuel vehicles need more than 25 small, micro and special motors. EPS (electric power steering), ABS (anti lock system) and igniter which require high motor performance need NdFeB permanent magnets, and they are mainly sintered NdFeB permanent magnets (some EPS motors use hot pressed NdFeB permanent magnets or bonded NdFeB permanent magnets). In addition to traditional EPS and ABS products, flat and centrifugal permanent magnet stepper motors are used in speedometers and ventilation systems; Automobile steering wheel torsion sensor, oil pump motor, seat adjuster, fan and other parts are gradually transiting to NdFeB permanent magnet. At present, bonding products have relatively high penetration rate, and sintered NdFeB products will be replaced in the future.
We believe that the future demand for NdFeB permanent magnets in the automotive industry will be driven by two factors. On the one hand, sintered NdFeB permanent magnets will use grain boundary penetration and other technologies to improve performance and reduce costs. The price gap between sintered NdFeB permanent magnets and ferrite products will gradually narrow, and the full life cycle cost advantage brought by high power efficiency will be reflected, especially in the global energy-saving carbon peak, low cost and low cost Driven by the pressure of energy conservation and emission reduction brought by carbon neutralization, the automobile has higher efficiency and lighter weight (not only the weight of the magnet itself is lighter, but also the whole motor design is more compact and lighter). On the other hand, with the improvement of digital control, electrification and intelligent driving, higher requirements are put forward for the sensitivity, accuracy and other performance of each control motor, and the application of sintered NdFeB permanent magnet and other high-end products in all kinds of control motors is accelerated. After 2010, the penetration rate of automobile EPS and ABS increased rapidly, which promoted the increase of NdFeB permanent magnet motor for traditional automobile and changed the downstream consumption structure of NdFeB permanent magnet; In 2013, the most important consumption in the downstream is electroacoustics and VCM. Electroacoustics accounts for about 35% and VCM accounts for about 6% – 7%, accounting for more than 40% in total. After 2017-2018, the application of traditional vehicles and new energy vehicles accounts for nearly 50%.
At present, ferrite permanent magnet motor is still the main small and micro motor in automobile. With the promotion of carbon peak and carbon neutralization policy, the improvement of automobile carbon emission standard will be accelerated. High performance Nd-Fe-B micro and special motor has higher power conversion efficiency, which can help automobile reduce fuel consumption and emission. It will also benefit the industry to realize intelligence, networking and automation.
Demand for new energy vehicles continues to increase
After the cost reduction of the whole industry chain and the decline of subsidies in 2018-2019, the driving force of global new energy vehicles will gradually transition from policy to market demand in 2020, starting a new round of high-speed growth period driven by popular products and demand. The driving motor for new energy vehicles will also become the most important increment of NdFeB demand in the future. Due to its high energy conversion efficiency, small size, safety and reliability, DC permanent magnet motor is suitable for use in the scene of frequent speed changes, and its technical requirements are relatively low; High performance AC synchronous permanent magnet motor depends on its excellent comprehensive performance, large power and torque, which makes up about 95% of the driving motors of new energy vehicles. The mainstream electric vehicle brands and models basically use DC permanent magnet motor. Only Tesla Model s and X adopt AC induction motor which is more suitable for stable driving on expressway.
The consumption of NdFeB permanent magnet for new energy vehicle drive motor is about 2.5kg. Electric vehicles generally use single motor, some high-performance models use dual motor, and the general drive motor needs to use 2.5kg NdFeB permanent magnet (the specific amount needs to be calculated according to the vehicle torque and power). Due to the relatively large volume of Nd-Fe-B magnetic materials for DC permanent magnet motors of electric vehicles and the relatively simple back-end machining, the loss from blank to finished products is relatively small, and the finished product rate and yield are higher than those of small device products such as consumer electronics and VCM. We expect that it will reach about 70% on average.
New energy automobile has entered a new round of rapid growth. In 2020, China’s new energy vehicle shipment will be 1.367 million, a year-on-year increase of 10.9%; The growth rate of global sales of new energy vehicles is much higher than that of domestic sales. In 2020, the shipment of new energy vehicles will reach 3.24 million, with a year-on-year growth of 43.36%. If the finished product rate of NdFeB for new energy DC synchronous motor is 70%, the global demand for NdFeB billets for new energy vehicles is about 11520 tons, while the domestic demand is 4900 tons.
In the next five years, global new energy vehicles will maintain an annual growth rate of more than 30%. In the second half of 2020, the sales of new energy vehicles will accelerate, the emission reduction policies and standards of European and American countries will be further improved, and the government’s support for new energy vehicles will also be improved. We expect that the new energy vehicle industry will maintain a high-speed growth trend from 2021 to 2025, with a compound annual growth rate of 35%. By 2025, the global sales of new energy vehicles is expected to reach more than 15 million, The permeability is about 15% – 17%; In 2025, there will be more than 5 million new energy vehicles in China, with a penetration rate of more than 15%.
We expect that the new energy vehicle industry will develop towards polarization in the future. Similar to the mobile phone industry, low-end products will increase rapidly with the price close to the people and the convenience of short distance use in the city, and the market share will increase, with Wuling Hongguang Mini EV as the representative; The high-end electric vehicle products expand their share in the middle and high-end automobile market by virtue of vehicle positioning, high endurance, complete automatic driving and Internet of vehicles configuration, represented by BYD (EV and DM series). The low-end products are equipped with low-end batteries and motors, so the demand for NdFeB is relatively small. The high-end products are equipped with high torque and high-power motors, and some models are equipped with dual motor systems, so the amount of NdFeB required will double. Therefore, we expect that the average demand for NdFeB for single vehicle driving main motors will remain stable in the future, and will not decline with the increase of the proportion of medium and low-end electric vehicles.
In the next five years, the demand of NdFeB permanent magnet will follow the high-speed growth of new energy vehicles. According to the calculation, by 2025, the amount of NdFeB finished products required by permanent magnet synchronous motor will reach 39400 tons, corresponding to the output of NdFeB blank will be 56300 tons, with a compound annual growth rate of 37.3%; The domestic demand will reach 16800 tons, corresponding to 24100 tons of blanks, with a compound annual growth rate of 37.5%. New energy vehicles will become the most important downstream demand increment of sintered NdFeB magnetic materials.
Broad development space of wind power driven by carbon neutralization
With the advantages of zero emission, relatively low manufacturing cost and long service life, wind power will be one of the important supports to reduce global carbon emissions. Before 2019, the global wind power installed capacity will fluctuate under the promotion of policy subsidies. With the technological progress, the scale advantage of wind power manufacturing gradually highlights, and the cost reduction and efficiency increase of the whole industry chain promoted by the reduction of subsidies, the wind power market will gradually transition from policy driven to market driven, and the domestic wind power market will be on the grid at a low price from 2020 to 2021.
In 2020, the installed capacity of global wind power is 96.3gw, with a year-on-year growth of 59%, of which the installed capacity of China is 71.67gw, with a year-on-year growth of 178%, exceeding the total capacity of 2017-2019; The overseas installed capacity is 24.63gw, which is lower than that in 2019. It is expected that the installed capacity will return to more than 30GW in 2021 with the control of the epidemic and the steady decline of the wind turbine price.
According to the new energy development plan of the State Council, by 2025, the domestic clean energy will account for about 20% of the domestic energy supply, and the total annual installed capacity of domestic wind power and photovoltaic power needs to be maintained at more than 120gw. According to the structure of photovoltaic and wind power, the new installed capacity of China’s wind power will average 50gw / year in the next five years, maintaining a stable growth. The overseas installed capacity is expected to maintain a steady growth on the basis of 30GW, with a compound annual growth rate of about 5-8%. It is expected that the overseas installed capacity will reach 45gw by 2025, and the new global installed capacity is expected to reach 100gw / year.
At present, there are four types of wind power generator: asynchronous wind generator, doubly fed induction wind generator, semi direct drive permanent magnet synchronous generator and direct drive AC permanent magnet synchronous generator. The induction wind generator and doubly fed induction wind generator do not need NdFeB permanent magnet, while the semi direct drive and direct drive AC permanent magnet synchronous generator need NdFeB permanent magnet. The penetration rate of semi direct drive and direct drive permanent magnet synchronous motor (PMSM) increases rapidly due to its easy maintenance. In addition, direct drive permanent magnet motors have certain advantages in large-scale wind turbines. In the future, with the large-scale units, especially the proportion of offshore wind power installed, the market share of direct drive and semi direct drive permanent magnet motors will also be further improved.
Domestic and foreign companies speed up the construction of direct drive and semi direct drive production capacity. The direct drive motors are represented by Goldwind technology and Xiangdian wind energy in China, and Ge Alstom and Siemens gamesa in overseas. In 2019, the representative large direct drive units of the four enterprises are 6.7w, 5MW, 6MW and 6 / 7mw products respectively; In China, Dongfang Electric, haizhuang wind power and Mingyang intelligent are the representatives of semi direct drive motors, while MHL Vestas and adwen are the representatives overseas. They represent the products of 5 / 5.5MW, 5MW, 6.5 / 7.25mw, 8mW and 5MW for large units respectively.
Energy saving elevator and frequency conversion air conditioner are expected to speed up penetration
Energy saving elevator
Compared with the traditional elevator, the advantages of energy-saving elevator focus on two aspects: one is the change of elevator structure, which does not need the machine room floor, so as to improve the floor utilization area; The second is to adjust the motor drag motion through frequency conversion, so as to reduce the power consumption. The drive system of energy-saving elevator adopts frequency conversion technology, and the drive system adopts NdFeB permanent magnet synchronous gearless traction technology, which can save 25% of electric energy compared with ordinary asynchronous motor.
In 2020, the output of elevators, escalators and elevators in China will be 1.282 million units, with a cumulative year-on-year growth of 7.8%. Affected by the epidemic, the growth rate will decline. With the promotion of China’s energy conservation and emission reduction policies and the rise of real estate prices, the advantages of energy-saving elevators are becoming more and more obvious. The proportion of energy-saving elevators will increase from about 30% in 2006 to 85% in 2020, and we expect to increase to 95% by 2025. According to the requirement of 6kg sintered NdFeB permanent magnet for a single elevator motor, the amount of sintered NdFeB permanent magnet consumed by the elevator in 2020 will be about 6500 tons.
Energy saving air conditioning
Frequency conversion air conditioning can significantly reduce energy consumption. With the technological progress and production improvement, the cost is reduced, and with the gradual improvement of China’s air conditioning energy efficiency standards, its penetration rate increases rapidly. According to the online data of the industry, in 2020, the domestic domestic domestic air conditioning output will be 144.9 million units, of which the output of variable frequency air conditioning will be 83.364 million units, accounting for 58%. In terms of sales volume, in 2020, the total sales volume of air conditioning enterprises in China will be 141.46 million units, of which 74.854 million units are frequency conversion air conditioners, accounting for 52.9%. In 2020, affected by the epidemic, domestic sales of household air conditioners will be 80.28 million units, a year-on-year decrease of 12.9%, and export sales will be 61.18 million units, a year-on-year increase of 4.7%; Among them, the internal sales volume of variable frequency air conditioners was 57.73 million, and the export volume was 17.12 million.
In July 2020, the new domestic standard GB21455 “limited values of energy efficiency and energy efficiency grades of room air conditioners” will be implemented. The new standard unifies the evaluation methods of fixed frequency air conditioners and variable frequency air conditioners, and only classifies them according to the seasonal energy efficiency (APF); The overall energy efficiency standard of air conditioning will be increased by 14%, and the overall energy efficiency of air conditioning industry will be increased by more than 30% by 2022. The new energy efficiency standard of air conditioning will eliminate more than 45% of the air conditioning equipment in the market before, the high energy consumption constant frequency air conditioning and the frequency conversion air conditioning below 3-level energy efficiency will be eliminated, and the frequency conversion air conditioning compressor can only meet the new standard by using high-performance sintered NdFeB permanent magnet.
According to the quantity of NdFeB required for a single variable frequency air conditioner motor is 0.1kg, the domestic output of variable frequency air conditioners will be 83.364 million units in 2020, and the quantity of sintered NdFeB will be 83.364 tons (the output of variable frequency air conditioners will be more than the sales volume in 2020, and some of them will be in stock). The sales penetration rate of domestic variable frequency air conditioning will reach 71% in 2020, and it is expected to increase to 85% by 2025; The proportion of variable frequency air conditioners in domestic air conditioners exported is only 28%. It is estimated that with the development of overseas economy and the improvement of energy consumption standards, it is expected to increase to about 40% by 2025, with an average annual increase of 2.4 PCT. We expect that the sales volume of domestic household air conditioners will remain stable, and the export volume will maintain a growth rate of 3%. By 2025, the domestic production of variable frequency air conditioners will consume 9660 tons of NdFeB.
Consumer electronics high end NdFeB returns to growth
With the advantage of technology accumulation and customer barriers, domestic manufacturers of magnetic materials are the main manufacturers of neodymium iron boron in the global electronics industry (VCM, electroacoustics, vibration motors, etc.). In 2020, they fully benefited from the high degree of visibility in the field of consumer electronics. The data center investment brought by COVID-19 promoted cloud transformation to return to high growth, and the industrial chain took the lead in recovery and market share improvement. Supported by this, the business of NdFeB for electronic use of major manufacturers will go out of the haze of two consecutive years of decline and return to the growth trend in 2020; At the same time, supported by the advantages of taking the lead in resuming work and complete industrial chain in China, domestic companies have gained a larger market share in the field of consumer electronics and mechanical hard disk VCM, and their main business quality and customer quality have been further improved. We expect that with the increase of shipment volume and the basically stable sales price, the production cost of products will be diluted and the profitability will be improved.
In the field of consumer electronics with sintered NdFeB permanent magnets, and have a large market share in mobile phones, earphones, speakers and other products. The components that need to use permanent magnets in mobile phones include acoustic systems such as loudspeakers and earphones, camera voice coil motor (VCM), high-end vibration motor, etc; The magnets of middle and high-end earphones are mostly sintered NdFeB products. In recent years, driven by TWS earphones, the demand for NdFeB in loudspeaker components has developed rapidly. In addition, the penetration rate of magnetic accessories in consumer electronics has also increased rapidly, mainly for suction accessories, such as the magnetic suction accessories of apple computer charging hole, tablet computer touch pen suction accessories, etc.
Mobile phone acoustics, TWS and other components drive the recovery of consumer electronics NdFeB consumption.
IPhone acoustic system magnets grow with sales
Since the beginning of iPhone 7, apple mobile phone has been equipped with dual speakers as standard. Therefore, the acoustic system of Apple mobile phone mainly includes two speakers, a transmitter and a microphone. The microphone is MEMS structure and does not need a magnet. With the increasing demand of consumers for sound quality, the volume of mobile phone speakers is gradually increasing; In order to improve the stereo effect of mobile phone, Android high-end mobile phone adopts dual speaker design. The increase in the volume of mobile phone speakers and the number of speakers used in a single machine jointly promote the demand for NdFeB in mobile phone acoustic system. The demand of NdFeB permanent magnet for mobile phone speakers is about 0.5g, and the speakers used in high-end mobile phones are relatively large, which can reach more than 0.7-0.8g.
In 2020, the shipment volume of iPhone will reach 207.1 million units, with a year-on-year growth of 5%, and the market share will rebound to 16%. In 2020, the global smartphone market will decline by 8.8% to 1.27 billion units due to the epidemic. In 2021, with the outstanding performance of the iPhone 12 series and the share of some manufacturers in the high-end market, Apple’s mobile phone shipment is expected to continue to rise. In addition, domestic mobile phone manufacturers continue to increase the shipment volume of high-end products. All manufacturers promote high-end products, and jointly push up the average price level of mobile phones. The demand for high-grade parts and modules also continues to increase. The penetration rate of dual speakers in Android mobile phones has gradually increased. Major Android mobile phone manufacturers have launched dual speaker mobile phones, and the dual speaker configuration has been decentralized to mid end mobile phone models, further promoting the growth of dual speaker demand.
Wireless charging coil provides new demand for NdFeB
IPhone 12 series products are equipped with MagSafe wireless charging coil as standard, in which the magnet array layer is a magnetic ring composed of 18 magnetic steel sheets and a positioning magnetic point composed of two slightly larger magnetic steel sheets. This wireless charging design will greatly promote the use of NdFeB permanent magnets, and the consumption of a single machine is about 1g; At the same time, MagSafe wireless charger accessories are also equipped with similar NdFeB magnetic rings as standard, which can increase the demand at the same time. We expect that this kind of wireless charging product will become standard in Apple’s iPhone, iPad, Iwatch and other products in the future, and Android manufacturers are also expected to follow up in high-end mobile phones to improve the wireless charging performance.
Permeability improvement of high performance vibration motor
In the early stage of mobile phone vibrator, rotor motor was used, mainly ferrite permanent magnet. Some high-end products used NdFeB magnet, and quickly penetrated. IPhone uses linear motor to bring a new technical route for mobile phone vibrator, and linear vibrator has gradually become the standard configuration of high-end mobile phones. Because of its high precision, high vibration intensity and low delay, linear vibration motor needs high performance NdFeB magnet. Starting with the standard tapic engine of iPhone 6 Series in 2014, after six years of technical development and updating iteration, it has been applied in Apple’s iPhone and Iwatch. The vibration structure of MacBook’s touchpad is similar to that of tapic engine. In addition, as the technology matures, the production cost of linear vibration motor is rapidly decreasing, which promotes the penetration of linear vibration motor in high-end Android mobile phones. It is expected that linear vibration motor will become the standard configuration of high-end Android mobile phones in the future. The demand of single linear vibration motor for NdFeB is expected to be about 0.5g, which is higher than that of ordinary rotor motor. At the same time, in order to get the required performance, the linear motor adopts the design of multi segment magnet, and different size magnets can produce different vibration amplitude. The touch panel of the new MacBook product adopts the design similar to that of tapic engine to simulate the real feeling of pressing paragraphs. The total consumption of NdFeB is about 7-8g, which is significantly higher than that of mobile phones and watches. In 2020, the iPhone system and Iwatch series will ship about 206 million units and 40 million units respectively, and the MacBook series is expected to ship 20 million units in 2021. It is estimated that the demand for magnetic materials of iPhone and Iwatch’s tapic engine products is 125 tons ((20600 + 4000) × ten thousand × 5 / 1000 / 1000 ≈ 125), and the consumption of NdFeB magnets by MacBook products is about 140 tons (2000 tons) × ten thousand × 7 / 1000 / 1000 = 140), the total amount of the two is 265 tons, and the demand for NdFeB green body is about 530 tons.
Nd-Fe-B for mobile phone speakers is expected to resume growth. From 2018 to 2020, global smartphone shipments will drop for three consecutive years. In 2020, the epidemic situation will accelerate and the industry will reach the bottom. In 2021, with the epidemic control and economic recovery, the 5g replacement is expected to restore positive growth. According to DIGITIMES research, in the first quarter of 2021, global smartphone shipments will reach 340 million units, with a year-on-year growth of nearly 50%. The growth of iPhone 12 series and Chinese manufacturers’ shipments is the main driving force; The recovery of mobile phone shipment will support the recovery of high-end NdFeB, and the company is expected to gain a larger market share with its technology and customer advantages.
Rapid penetration of TWS earphone products
In 2016, Apple released the first generation of airpods products, opening the prelude to the development of TWS. With the transition of Bluetooth technology from the fourth generation to the fifth generation and the development of Bluetooth chip design, the problem of signal transmission asynchrony and delay has been solved, and the use experience of TWS headset has been greatly improved. The rapid maturity of Android TWS headphone design led by Luoda and Qualcomm has driven the production cost of TWS headphones down rapidly. Driven by the improvement of user experience, the maturity of technology and the decline of cost, TWS headphones have penetrated into the world rapidly. All major consumer electronics manufacturers have launched TWS earphones. With the large-scale shipment of white brand earphones, counterpoint predicts that the global brand TWS earphones shipment will reach more than 238 million in 2020, of which Apple’s airpods series is expected to reach more than 100 million.
In 2021, it is expected that TWS headphones will continue to grow at a high speed. In addition to Apple headphones, Android TWS headphones will grow faster. According to the monthly shipment volume of major TWS headphone chip manufacturers Zhuhai Jieli and Zhongke Lanxun reaching 30 million and 25-30 million respectively, only two manufacturers can meet the demand of 350 million TWS headphones. From 2021 to 2023, the global shipment of TWS headphones will exceed 500 million, 700 million and 1 billion units, and the long-term average annual shipment of TWS headphones will catch up with the global shipment of smart phones.
According to 0.2g for each ordinary TWS headset and 0.3g for high-end products, Apple’s airpods series and Android brand high-end headphones account for 40%. It is estimated that the global demand for high-end NdFeB for TWS headphones in 2021 will be 319 tons and 424 tons. Due to the small volume, high processing difficulty and complex surface coating treatment of TWS earphone NdFeB, the demand for high-end NdFeB body is 638 tons and 869 tons according to the finished product rate of 50%.
Mechanical hard disk for data center
Mechanical hard disk VCM products are the traditional competitive products of domestic companies. Zhongke Sanhuan and Ningbo Yunsheng have become the leading VCM magnet manufacturers in the world before 2010, and their market share ranks second in the world. Since 2016, due to the replacement of mechanical hard disk by solid state hard disk in the computer market, the shipment volume of VCM magnets has fluctuated and declined. However, domestic companies have strengthened the development of head customers through technology upgrading and cost advantages, and their share has increased steadily. In 2020, the epidemic situation will accelerate, the penetration rate of online office, video conference and short video will increase, and the cloudization of various industries will accelerate, which will promote the growth of data center investment. Since the second half of 2019, the growth rate of capital expenditure of the world’s leading cloud computing companies has picked up. In China, the construction of data center is regarded as an important area of “new infrastructure”, and the construction of cloud computing and data center is vigorously promoted.
According to the data of the consulting firm cartner, the global cloud computing market size in 2019 is 355.6 billion US dollars, with a year-on-year growth of 16.3%. It is expected to maintain a compound growth rate of more than 15% from 2020 to 2022, and the market size will reach 550 billion US dollars by the end of 2022. The epidemic situation in 2020 leads to the acceleration of cloud computing. It is estimated that the scale of global cloud computing will increase by about 18% in 2020, reaching US $427 billion. In 2019, China’s cloud computing market will reach 134.5 billion yuan, with a year-on-year growth rate of 39%. The global market share is still small, but the growth rate is significantly higher than the global average. It is estimated that the growth rate will remain above 30% in the next five years, reaching 380 billion yuan by 2023.
As the basis of cloud computing hardware, data center will follow the rapid development of cloud computing. In 2019, covid-19 billion invested in the global data center about 100 billion US dollars (680 billion RMB). In 2020, the capital expenditure slowed down, and the capital account growth rate was around 2% in 2020, according to market research firm Dell’Oro Group data. It is expected to increase to 10% in 2021. However, the growth rate of domestic data center market is higher than that of the global market. In 2019, the scale of Chinese market will be about 155 billion yuan, with a year-on-year growth of 27%. It is expected to maintain a compound annual growth rate of about 25% in the future. By 2024, the market scale will exceed 450 billion yuan, and the global market share will rise to more than 30%.
The number of domestic data center cabinets maintains a medium high speed growth trend, business models and market participants are gradually diversified, and the third-party data center is rapidly rising to become an important market participant. In 2019, the number of IDC cabinets in stock in China will increase from 360000 to 2400000, with a year-on-year increase of about 17.7%. It is estimated that the number of new cabinets will increase from 400000 in 2020 to 800000 in 2025; The number of existing cabinets will maintain a growth rate of 15% – 20% and reach about 5.4 million by 2024.
VCM structure is used in the positioning motor of mechanical hard disk, and sintered NdFeB is needed. The spindle motor of mechanical hard disk usually uses bonded NdFeB. In 2020, the global shipment of mechanical hard disks is 260 million, a year-on-year decrease of 18.2%. However, the data center business uses mechanical hard disks to achieve positive growth, and the consumption increases from 60 million in 2019 to 71 million, a year-on-year increase of 18%, driving the overall revenue and capacity of the data center to achieve steady growth. According to Toshiba report data, in 2020, the global mechanical hard disk shipping capacity exceeded 1 billion TB, with a year-on-year growth of 16.9%, and the unit capacity increased from 2.7tb to 3.84tb, with a growth rate of more than 41%.
The growth of mechanical hard disk capacity has led to the increase of VCM motor volume, and the number of magnetic materials required has increased. However, it is estimated that the loss of magnetic material demand caused by the decline of mechanical hard disk shipment will not be made up. Therefore, domestic magnetic material companies have increased their expansion in key customer areas, Seagate, the world’s major manufacturers of mechanical hard disk, and Western China’s data share will increase (in 2020, the global market share of mechanical hard disk of the two manufacturers will be 42.7% and 37% respectively, accounting for about 80% in total).
The demand of mechanical hard disk positioning VCM for sintered NdFeB is about 4-5g / piece. According to the year-on-year decrease of 10% to 235 million mechanical hard disk in 2021, the demand of magnetic material is slightly increased due to the capacity improvement. Then, the demand of mechanical hard disk VCM for sintered NdFeB is estimated to be about 940-1175 tons in 2021, and the corresponding blank demand is 1880-2350 tons according to the 50% yield.
Servo motors benefit from industrial automation acceleration
Servo machine as a kind of high-end motor has a wide range of applications in the field of industrial control. Since the 1980s, the electrical servo system has entered the AC servo stage, and the servo motor is usually permanent magnet synchronous motor. In 2011, the scale of China’s servo system reached 7 billion 800 million yuan, and it increased rapidly with the rapid development of domestic industrial robots, 3C electronics and battery manufacturing industry. In 2017, it reached 11 billion 500 million yuan, an increase of 27.8% over the same period last year. In 2020, COVID-19 stimulated the penetration of industrial automation, and expected the service system to grow 20% or 14 billion 500 million yuan over the same period.
With the development of high-end manufacturing industry, the downstream application of servo motor gradually develops rapidly from the early textile, packaging and printing fields to 3C electronic manufacturing, industrial robot, battery manufacturing and other fields, and its market share increases rapidly. In 2011, textile, printing and packaging accounted for nearly 40%, and by 2019, it will drop to about 12% – 13%; The proportion of machine tools decreased from 25% to 12%, while the proportion of high-end application electronic manufacturing and industrial robots increased from 9% in 2011 to about 27% in 2019. At the same time, new application fields are rising rapidly. With the rapid development of new energy vehicles, the servo system required in battery manufacturing field is growing rapidly, accounting for 8.6% by 2019. Domestic battery manufacturing will maintain a growth rate of more than 30% from 2021 to 2025, and the demand for servo system in battery manufacturing field is expected to increase to more than 15% by 2025.
In 2020, COVID-19 accelerated the upgrading of the global industrial system, accelerated the upgrading of industrial automation and intelligent manufacturing upgrading, and promoted the rapid growth of the domestic servo system. The domestic industrial control system leading company’s revenue growth in 2020 was 40%-75%, and its net profit growth rate was 60%-120%. We expect that the domestic servo system is expected to achieve a scale growth of more than 20%, and will continue to have a high momentum in 2021.
The overall difference of servo motor is large. The average price of Ningbo Yunsheng’s servo motor products is about 4000 yuan / piece, and the consumption of sintered NdFeB permanent magnet is 1kg. The consumption of larger products can reach 2-3kg, and the corresponding sales price is also higher. The global servo motor market will reach US $765 million in 2019, and is expected to grow by 15% to US $880 million in 2020. China’s Chinese mainland’s servo market is less than 20% in Chinese mainland market in 2019. It is mainly occupied by Japanese and European and American manufacturers. Among them, Panasonic, ashihito and delta are 17.3%, 16.2% and 11.2% respectively. The largest manufacturer in mainland China is 10.8%. In terms of the global market share of 20%, the global average annual output of servo motors in 2018-2020 is about 8.3 million; Assuming that the average amount of NdFeB permanent magnet used by each servo motor is 0.5kg, the amount of NdFeB finished products consumed by servo motors in the world is 4150 tons; According to 65% yield, the demand of NdFeB blank is about 6400 tons.
The price of rare earth materials tends to be stable, and the proportion of heavy rare earth decreases with technological progress
In the second half of 2020, the price of rare earth will increase greatly
Neodymium (praseodymium) accounts for about 30% of the weight of NdFeB permanent magnet, and the cost accounts for 60-75%, which is the main cost item. Therefore, the price of various brands of sintered NdFeB permanent magnet fluctuates with the price of rare earth. Fundamentally speaking, NdFeB permanent magnet industry belongs to processing industry, and the price difference between products and raw materials can be regarded as processing fee. The enterprises with the advantages of raw material formula, technology, back-end processing and high-end customers enjoy the excess income.
Since the second quarter of 2020, driven by demand, the price of rare earth has continued to rise, while the growth of rare earth ore terminal is slow due to the restriction of domestic quota. In recent years, the increase of rare earth ore supply mainly comes from the expansion of overseas mine production. The price of praseodymium oxide and neodymium continued to rise from low 300000 / T to more than 500000 / T, and the price of metal neodymium increased from 370000 / T to more than 850000 / T, with an increase of more than 100%, exerting great pressure on the cost side of NdFeB permanent magnet. According to the calculation that the proportion of neodymium (praseodymium) in high-end NdFeB is 30%, and the doping proportion of dysprosium and terbium is 0.5% and 1%, the production cost of NdFeB permanent magnet will rise by more than 60% in the second half of 2020 due to the high price of rare earth. Jinli permanent magnet is one of the companies with the best cost control in the industry. From 2018 to 2020, the average production cost of the company’s NdFeB magnetic steel is 205000 / T. according to our calculation, the cost increase caused by the price rise of PR, Nd, Dy and TB is 130000-140000 / T, which is basically equivalent to the original cost of rare earth elements before the price rise. As the intermediate processing link, the manufacturers of NdFeB permanent magnet are mainly motor manufacturers, air-conditioner manufacturers, automobile manufacturers and fan manufacturers. Their bargaining power is relatively weak, which limits the cost transmission ability. Therefore, the price fluctuation of NdFeB permanent magnet steel is mainly in the form of follow-up. The prices of NdFeB blanks of mainstream brands such as N35 and H35 are 63300 / T and 79000 / T respectively from the highest in the second quarter of 2020, which is lower than the increase of the cost of rare earth raw materials. However, manufacturers with capacity, customers and technology advantages are expected to seize this opportunity to expand market share through cost control advantages.
Rare earth production is expected to increase steadily
Global rare earth ore (REO) will grow by 6% year on year in 2020.
Supply constraints are also one of the main reasons for the price rise of rare earth in this round. According to the data of Antaike, in 2020, the global output of rare earth ore (equivalent to REO) will be 233000 tons, with a year-on-year growth of 6.6%. The output growth is mainly due to the increase of China’s quota and the full production of the United States’ mantinpas mine. The output of China and the United States will be 140000 tons and 35000 tons respectively; Other countries are affected by the epidemic to varying degrees. Australia’s output is basically flat at 21000 tons driven by Linus company, while Myanmar’s output is reduced from about 27700 tons in 2019 to 25300 tons due to the epidemic and domestic situation, which has a negative impact on the output of medium and heavy rare earth minerals. Other countries are mainly Russia and Madagascar, with output of about 3000 tons and 2000 tons.
In 2020, with the demand of many main application directions increasing significantly, the supply growth is lower than expected, especially the domestic rare earth mining index is strictly controlled, and the self-produced rare earth mines can not meet their own demand, so they need to be imported from the world. In 2020, China’s rare earth mining quota (REO) is 140000 tons, and the output of rare earth oxide separation products is about 194000 tons, of which 34400 tons and 25000 tons of rare earth oxide are separated by imported rare earth concentrate and monazite smelting respectively. Overseas smelters and separators are mainly plants in Malaysia of Linus, Australia, with an annual output of 16200 tons of REO. In 2020, the global output of rare earth oxidation, smelting and separation will be about 212000 tons, with a year-on-year increase of 20.3%. The domestic output will increase from 155000 tons in 2019 to 194000 tons, and the increment will mainly come from imported rare earth ore and monazite ore. The growth rate of smelting separation output is higher than that of rare earth ore output, which proves that the downstream demand is strong, and the rapid de mineralization of rare earth ore of smelting separation manufacturers is also an important reason for the output growth.
Domestic rare earth ore and smelting separation volume is expected to increase steadily in 2021
In 2020, the mismatch between supply and demand caused by the strong demand for rare earth and the rising price of rare earth are the important reasons for the increase of rare earth mining quota in China, so as to prevent the sharp rise of upstream raw materials from harming the industrial chain. On February 18, 2021, the Ministry of industry and information technology issued the first batch of rare earth mining quota in 2021, which increased by 27.3% to 84000 tons of REO year on year. If the quota in the second half of the year also increased in the same proportion, the annual mining quota will increase by 20% to 178000 tons.
Domestic smelting separation quota also increased in the same proportion. At the same time, overseas rare earth mines accelerated the recovery and mining progress under the stimulation of high prices. It is expected that the global increment of rare earth mines will mainly depend on domestic smelting capacity. According to our calculation, the increase of overseas rare earth mines in 2021 is limited, and the United States’ montingpass mine is basically at full load, and the increase may mainly come from the brown mountain of the northern mining industry of the United States; The Yangdi Bana mine of Hastings company of Australia obtained the environmental license in April 2020, and the construction progress is expected to be accelerated in 2021; Australia peak Resources Co., Ltd. is in the final stage of mining approval in ENGRA, Tanzania. It is expected to enter the mining stage in 2021, but the overall increase of overseas rare earth ore is limited.
We expect the global output of rare earth ore (REO) in 2021 to be 270000-280000 tons, a year-on-year increase of about 20% compared with 233000 tons in 2020, of which the domestic output increment is about 38000 tons and the overseas increment is 10000 tons. The overseas increment mainly comes from the gradual recovery of mines in Australia and Myanmar, and the overall increment of output in the United States is limited.
In April 2021, the price of rare earth tends to be stable, and the cost pressure of magnetic materials gradually decreases
From February to march in 2021, the price of rare earth entered the stage of accelerated rise, and the metal neodymium rose rapidly from 650000-700000 / T to more than 850000 / T. The sharp and rapid rise of rare earth prices caused downstream manufacturers to purchase on demand and reduce the purchase volume under the pressure of cost. Hoarder traders also gradually increased their shipment at high prices. The rising trend of rare earth prices was loose. After entering April, the price of rare earth dropped, and the cost pressure of downstream manufacturers was alleviated to a certain extent. By the middle of April, the average transaction price of Neodymium in China was about 750000 yuan / ton (including tax), which was about 15% lower than the high point, and still more than 300000 yuan / ton higher than the low point in the second quarter of 2020. We believe that the current price is still profitable for domestic and overseas rare earth mining enterprises. According to the data of Australian rare earth company Lynas, the cost of rare earth mining is 17500 US dollars / ton REO, and the gross profit rate will increase by 52% in the second half of 2020. At the present stage, it should be about 55%. The medium and large-scale magnetic material manufacturers have relatively strong cost transmission ability, while the terminal application manufacturers are at the acceptable limit point for the current price of rare earth and NdFeB magnetic steel, so they put forward the requirements of reducing the magnetic material standard and reducing the temperature safety range to reduce the cost.
The price of rare earth tends to be stable after a slight fall, which temporarily relieves the cost pressure of magnetic material enterprises. In the second half of 2020, the price will be high in the first quarter to the second quarter after the transmission of the gross profit rate of rare earth magnetic material manufacturers. It is expected that the first quarter of 2021 will be the most cost pressure quarter, and the second quarter will usher in the turning point of cost pressure. Therefore, we are optimistic about the recovery of profitability of magnetic material enterprises in the second to third quarter. At the present stage, the stock price of magnetic material enterprises fluctuates at the bottom for a long time, so we are optimistic that with the recovery of profits, the stock price of magnetic material enterprises is expected to rebound or even reverse at the bottom.
We believe that from the perspective of the whole rare earth magnetic material industry chain, the continuous sharp rise of rare earth prices is not conducive to the healthy development of the whole industry chain, and maintaining the prices in a reasonable range helps to avoid the recurrence of downstream application penetration, thereby affecting the final demand. On the one hand, the increase of domestic rare earth mining quota is conducive to easing the supply tension and ensuring that the price of upstream resources is in a reasonable position; At the same time, in recent years, the growth of China’s rare earth mine quota is lower than the growth of downstream demand, which leads to the weakening of China’s rare earth competitive advantage in the world. Increasing quota and ensuring supply can reverse this trend and enhance the global share of advantageous industrial chain.
Leading manufacturers have relatively strong ability to conduct costs and stable profitability
The integrated large-scale NdFeB magnetic steel manufacturers have relatively strong overall cost control and transmission ability, and maintain relatively stable profit level in the process of rising rare earth prices in the second half of 2020. On the one hand, the manufacturers of rare earth magnetic steel have the rare earth inventory to meet the production demand for about a quarter, so as to ensure that there are still more low-cost inventory in the process of rare earth price rising in the second half of 2020; On the other hand, the rapid progress of technology has driven down the cost. The wide application of grain boundary penetration technology has greatly reduced the doping amount of medium and heavy rare earths. At present, the doping amount of terbium in the downstream magnetic steels used in ordinary cars, new energy vehicles, energy-saving air conditioners, etc. has decreased from more than 5% to about 1%, and is expected to further decrease to about 0.5% in the next two years, The doping amount of heavy rare earth is reduced, and the production cost is greatly saved. In addition, with the capacity, product quality and supporting capacity of leading manufacturers, the bargaining power of downstream customers is stronger than that of the whole. The gross profit rate did not decline in the process of rare earth price rise. On the contrary, due to the growth of share and shipment volume, the fixed cost was diluted and increased.
Source: China Permanent Magnet Manufacturer – www.rizinia.com