Highlights

• China Northern Rare Earth Group achieved a 727.3% year-over-year increase in net profit for Q1 2025.
• Operating revenue reached ¥9.29 billion.
• Company's performance is marked by higher praseodymium-neodymium product prices and lower raw material costs.
• Performance occurred despite weakening overall market demand.
• Report highlights strategic implications of China's rare earth market dominance amid escalating U.S.-China trade tensions.
• Potential supply chain disruptions noted in the context of trade tensions.

China Northern Rare Earth Group (opens in a new tab), one of the world’s largest supplier of light rare earths, reported a substantial 727.3% year-over-year surge in net profit for Q1 2025, driven by higher average prices for praseodymium-neodymium (Pr-Nd) products and lower raw material costs. Operating revenue hit ¥9.29 billion (~$1.28 billion), up 61.2% YoY, with net income reaching ¥431 million. Excluding non-recurring gains, core net profit rose 11,623%. The company credits a combination of market timing, structural reforms, and enhanced production and sales capacity across oxides, metals, and magnetic materials.

While this news comes from Shanghai Metals Market (opens in a new tab), Rare Earth Exchanges notes that this company is partially state-owned.

Yet beneath these headline gains, the broader picture is more restrained. Despite a Q1 price gain of 12.57% YoY in Pr-Nd oxide (to an average of ¥429,605/mt), recent data shows weakening demand, tepid transactions, and increasing caution from downstream buyers—especially amid pre-Labor Day restocking. The short-term uptick in spot market inquiries is more tactical than structural, with most enterprises reluctant to accept high-priced feedstock in the face of lackluster global demand. Meanwhile, prices for heavy rare earths like dysprosium and terbium continue to decline, raising questions about the sustainability of the revenue surge.

Crucially, this report's timing coincides with escalating U.S.–China trade tensions. With the Biden-to-Trump transition reigniting global tariff disputes, China's grip on rare earth supply—particularly via state giants like China Northern—gains renewed geopolitical weight.

The firm’s increasing price-setting power and stated efforts to “enhance price control and market influence” suggest a strategic pivot not just toward profitability, but toward leveraging rare earth dominance in a fractured global trade landscape. For U.S. defense and clean energy sectors still reliant on Chinese supply, the message is clear: short-term profit may be up, but long-term access is increasingly precarious.