CITIC Construction Investment: The expectation of peak season is likely to boost rare earth prices upward.

CITIC Construction Investment Securities research report indicates that in July, the performance of various rare earth products showed significant differences. Praseodymium neodymium oxide initially rose before being suppressed, terbia oxide jumped before correction, while dysprosium oxide remained stable overall. On the supply side, production significantly declined due to tight raw material issues at waste recycling plants. According to SMM data, the output of praseodymium neodymium oxide in July decreased by 11% month-on-month, and although there may be marginal improvement in August, overall production remains constrained. The high-temperature holiday led to a decline in the operating rates of downstream motor manufacturers, resulting in weakened demand, and August remains the off-peak season. The traditional peak consumption period of "Golden September and Silver October" has seen strong expectations for demand recovery. It is anticipated that downstream inventory replenishment will restart in mid-to-late August, breaking the dual weakness pattern of supply and demand, and promoting price stabilization and upward movement.