Baogang to Boost Rare Earth Concentrate Output Amid Growing Demand

Baogang

China’s Leading Steelmaker Targets 390,000t Rare Earth Output in 2025

Chinese steel giant Baogang Group plans to increase its rare earth concentrate output in 2025 to meet surging downstream demand. The company will raise its output to 390,000 tonnes, equivalent to 195,000 tonnes of 50% rare earth oxide (REO) content. This would mark a steady increase from 370,000 tonnes in 2024 and 320,000 tonnes in 2023.

Rare Earth Demand Drives Quota Expectations

Market participants expect China to raise its rare earth mining quotas by 8–10% in 2025. Growth in magnet production and other downstream applications has continued to drive demand for REO. Baogang operates the Bayan Obo mine, the world’s largest rare earth site, which holds 35 million tonnes of REO reserves. This mine represents 81% of China’s total rare earth resources.

Baogang supplies all of its rare earth concentrate to Northern Rare Earth (NRE), China’s largest light rare earth producer. NRE’s mining quota rose to 188,650 tonnes in 2024, accounting for 75% of the nation’s total light rare earth quota.

Revenues Under Pressure Despite Output Growth

Baogang earned ¥9.1 billion ($1.25 billion) from rare earth concentrate sales in 2023, making up nearly 13% of its total revenues. While 2024 revenue figures have yet to be released, NRE expects its 2024 net profits to fall sharply to ¥950 million–¥1.08 billion, down more than 54% year-on-year.

The decline stems from a combination of factors, including weak global economic conditions, excess supply, rising recycling capacity, and sluggish downstream demand. Competition has intensified in application markets, putting further pressure on rare earth prices and margins.