Highlights

• China Northern Rare Earth Group is building the world's largest rare earth refining complex and a 50,000-ton NdFeB magnet alloy plant, widening the capacity gap with Western competitors.
• The company launched China's first intelligent axial-flux motor production line and advanced recycling technologies, signaling vertical integration from raw materials to finished components.
• China's new national rare earth price index strengthens its ability to control global benchmark pricing, underscoring end-to-end supply chain dominance from mining to market infrastructure.

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China’s state-owned China Northern Rare Earth Group released (opens in a new tab) a year-end summary outlining major 2025 developments that underscore its expanding dominance across rare earth mining, separation, magnet materials, advanced manufacturing, and pricing infrastructure.

What’s New — and Why It Matters

The most consequential update is the start of Phase II construction on what the company calls the world’s largest rare earth refining and separation complex, described as a “green smelting and upgrading project.” When completed, the expansion is expected to further consolidate China’s advantage in midstream processing, the most strategically sensitive chokepoint in the global rare earth supply chain. For Western governments seeking to localize rare earth processing, this move widens the capacity and cost gap.

Equally significant is the near-startup of a 50,000-ton high-performance neodymium-iron-boron (NdFeB) alloy plant, which Northern Rare Earths says will be China’s largest single-site rare earth magnet alloy facility, optimized for cost, automation, and quality. This reinforces China’s lead in downstream magnet materials, critical for EVs, wind turbines, robotics, defense systems, and consumer electronics.

The company also announced approval of a new 5,000-ton-per-year rare earth oxide (REO) separation project, formed through a joint venture with a subsidiary of Xiamen Tungsten. The project aims to achieve full separation of 15 individual rare earth elements by 2026, further tightening China’s grip on high-purity separated oxides needed by advanced manufacturers.

Technology Signals with Strategic Implications

Northern Rare Earths highlighted the launch of China’s first intelligent axial-flux (disc) motor production line using rare earth permanent magnets. The motors are described as dramatically smaller, lighter, and more energy-efficient than conventional designs, with applications spanning EV thermal systems, drones, robotics, and smart electronics. This signals continued vertical integration from materials to finished components, an area where the U.S. and Europe remain structurally exposed.

The company also unveiled progress in bio-leaching and recycling technologies for rare earth tailings and urban waste, including pilot lines for rare earth recovery. While still early-stage, these technologies could lower China’s long-term dependence on new mining while improving ESG optics.

Market Control and Pricing Power

In December 2025, China formally launched a national rare earth price index, built on domestic exchange transaction data and government-guided methodology. For Western buyers, this is notable: it strengthens China’s ability to define benchmark pricing, influence contracts, and shape global expectations—particularly if alternative pricing hubs fail to scale.

Why the West Should Care

Taken together, these updates show China reinforcing end-to-end control: raw materials, separation, magnets, motors, recycling, standards, workforce training, and pricing. For the U.S. and its allies, this underscores how far behind ex-China supply chains remain—and how difficult it will be to compete without sustained industrial policy, financing, and permitting reform.

Disclaimer: This news summary is translated and interpreted from media published by a Chinese state-owned enterprise. Claims regarding capacity, technology leadership, and global ranking should be verified through independent, non-Chinese sources.

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