Heavy rare earth free NdFeB alloy from VAC targets China-independent magnet supply

Vacuumschmelze

Heavy rare earth free NdFeB alloy from VAC marks a major shift in Western magnet strategy. German producer Vacuumschmelze has launched VACODYM 902 TP, a neodymium-iron-boron grade that avoids dysprosium and terbium. As a result, the heavy rare earth free NdFeB alloy offers high performance while reducing exposure to increasingly volatile heavy rare earth markets.

VACODYM 902 TP extends VAC’s family of reduced-HRE NdFeB grades. The new heavy rare earth free NdFeB alloy achieves a remanence of at least 1.40 Tesla and a coercivity of at least 1,190 kA/m. These metrics place it firmly in the high-performance segment for traction motors and industrial drives. Therefore, OEMs gain an alternative to conventional NdFeB magnets that rely on dysprosium and terbium to maintain coercivity at elevated temperatures.

Western buyers have sought heavy rare earth free NdFeB alloy solutions for several years. Dysprosium and terbium production still concentrates overwhelmingly in China, which creates structural supply risk. Meanwhile, policymakers and OEMs push for magnet designs that reduce heavy rare earth intensity without sacrificing performance. VAC’s new grade directly responds to this pressure and is fully produced within Western supply chains.

Export controls and price spikes intensify heavy rare earth risk

China’s export controls on certain rare earths have tightened heavy rare earth availability for Atlantic buyers since April. Spot prices for dysprosium and terbium outside China surged immediately after the controls. European terbium oxide prices rose by 268pc between 1 April and early September, reaching $3,300-3,800/kg cif Europe. As a result, magnet makers now face severe raw material cost volatility and procurement uncertainty.

This environment accelerates the search for alternatives to heavy rare earth dependent NdFeB grades. VAC explicitly cites volatile raw material costs and market uncertainty as major supply chain challenges. Therefore, its new alloy is positioned as a “geopolitically independent alternative” to traditional heavy rare earth based solutions. The goal is clear: decouple magnet performance from a small, politically sensitive set of Chinese-controlled metals.

Other Western players are also moving to build ex-China heavy rare earth capacity. Lynas has started small-scale dysprosium and terbium oxide production in Malaysia. US producer Energy Fuels has produced pilot-scale dysprosium and plans larger-scale dysprosium and terbium output in Utah by late 2026. MP Materials supplies a heavy rare earth concentrate, SEG+, containing dysprosium and terbium for downstream processors.

Western magnet supply chains pivot toward diversified feedstocks

VAC’s launch of a heavy rare earth free NdFeB alloy fits a broader diversification trend. Western magnet producers and their customers want designs that either use fewer heavy rare earths or none at all. This shift complements efforts to develop new mining, separation and recycling capacity outside China. It also supports OEM strategies to meet ESG targets and reduce geopolitical risk in EV and wind supply chains.

VAC emphasises the importance of resilient, regionally anchored magnet value chains. Its new alloy, fully produced in the West, supports that objective. However, performance in real-world motor and generator platforms will ultimately determine adoption. Automotive and industrial customers will test VACODYM 902 TP against existing HRE-containing grades on efficiency, temperature stability and cost.

If performance proves comparable, heavy rare earth free NdFeB alloy families could gain rapid traction. That would gradually reduce Western dependence on Chinese dysprosium and terbium, even as new ex-China projects ramp up. In parallel, recycling and alternative motor topologies may further ease heavy rare earth demand over the next decade.

The Metalnomist Commentary

VAC’s move shows how magnet technology, not only mining, will shape the next phase of the rare earth race. A commercially viable heavy rare earth free NdFeB alloy gives Western OEMs a real lever to hedge against Chinese export controls and price spikes. Market participants should watch qualification timelines closely, because large-scale adoption could materially shift dysprosium and terbium demand forecasts.