Rare Earth Magnets: From Oxide to Finished Magnet
Facts checked against sources on . How we check facts.
A rare earth magnet is made in four steps: separated oxides are reduced to metals, the metals are alloyed, the alloy is turned into powder, and the powder is pressed and heated into a magnet. Adamas Intelligence tracks the chain as oxides, metals, NdFeB alloys and powders, and magnets. Adamas expects metal-making capacity and heavy rare earth supply to be near-term bottlenecks for factories outside China, even as plants such as Neo's in Estonia, eVAC's in South Carolina and MP Materials' in Texas start production.
4 steps
oxide, metal, alloy and powder, magnet: the chain Adamas Intelligence tracks from mine to magnet
Source: Adamas Intelligence
December 2025
month MP Materials began making NdFeB magnets at Independence, Texas
Source: MP Materials Q2 2026 results
about 400 t
a year of samarium oxide that Lynas expects from its first production step, for samarium-cobalt magnets
Mar 2026
month Lynas signed a framework with LS Eco Energy for a rare earth metal-making facility in Vietnam; binding cross-subscription agreements of about A$29 million each followed in July 2026
Source: Lynas 2026 Annual Report
How is a rare earth magnet made?
The chain has four steps, and each has a different geography and a different set of companies. The table shows the steps with the facts the sources give.
| Step | Output | Who is doing it outside China | What the sources say |
|---|---|---|---|
| 1. Oxide separation | Neodymium-praseodymium, dysprosium, terbium and samarium oxides | Lynas, MP Materials | Lynas produced 7,260 t of NdPr in the year to June 2026 and 19 t of Dy and Tb in the June 2026 quarter (Lynas annual report, June quarterly report) |
| 2. Metal making | Rare earth metals | MP Materials; Lynas with LS Eco Energy planned in Vietnam | Adamas expects metal-making capacity to be a near-term bottleneck (Adamas) |
| 3. Alloy and powder | NdFeB alloys and powders; MP reports "magnet precursor" revenue | MP Materials and others | MP's magnet precursor revenue fell slightly in the June 2026 quarter as magnet production started (MP) |
| 4. Magnet | Sintered or recycled-content magnets | MP Independence, Neo (Estonia), eVAC (South Carolina), Noveon, Vulcan Elements | See the magnet makers page |
How do the two main magnets differ?
Neodymium-iron-boron magnets are strong and are made with neodymium and praseodymium, with dysprosium or terbium added to resist demagnetisation at high temperature. Research at Osaka University notes that these heavy additions raise coercivity but lower the maximum energy product, and describes grain boundary diffusion as an effective way to apply dysprosium. Samarium-cobalt magnets use samarium and are used in high-temperature environments such as aerospace, according to Lynas. The US defense procurement rule covers both types, so a defense buyer must source either without Chinese mining, refining or separation from 2027. The elements are on the magnet rare earths page.
Where are rare earth magnets used?
Magnets are used wherever a compact, strong motor or actuator is needed. The sources illustrate it across several markets.
| Application | Evidence |
|---|---|
| Electric vehicles | The IEA says rare earths are about 40% of a permanent magnet's cost but under 1% of a vehicle's value; electric car sales passed 20 million in 2025 (IEA via Global Mining Review) |
| Consumer devices | Apple committed $500 million to buy recycled-content magnets from MP Materials for its products, with shipments from 2027 (MP Materials) |
| Hard disk drives | Hard drive motors are a source of magnets for recycling at HyProMag (Physics World) |
| Air conditioners | Mitsubishi Electric began tonne-scale trials in 2026 of dismantling neodymium magnets from air conditioner compressors (SMM) |
| Aerospace and defense | Samarium-cobalt for high-temperature use; US defense rule from 2027 (Lynas) |
Frequently asked questions
What is the difference between NdFeB and SmCo magnets?
NdFeB magnets contain neodymium, iron and boron, with dysprosium or terbium added for heat resistance, while SmCo magnets contain samarium and cobalt and are used in high-temperature environments such as aerospace. Both are covered by the US defense rule on Chinese-origin materials from 2027.
How is a rare earth magnet made?
A rare earth magnet is made by separating rare earth oxides, reducing them to metals, alloying the metals, turning the alloy into powder and pressing and heating it into a magnet. Metal making is expected to be a near-term bottleneck outside China.
Why is dysprosium added to NdFeB magnets?
Dysprosium is added to NdFeB magnets to raise their coercivity so they keep their magnetism when hot. It lowers the maximum energy product, according to research from Osaka University.
Where are rare earth magnets used?
Rare earth magnets are used in electric vehicle motors, consumer devices, hard disk drives, air conditioner compressors and aerospace and defense systems. The IEA says rare earths are about 40% of a magnet's cost but under 1% of a vehicle's value.
Sources
Read on October 12, 2026. Figures on this page come from these documents; where a number is an estimate, the source says so.
- Adamas Intelligence: Rare Earth Magnet Market Outlook, top predictions for 2026
- Lynas Rare Earths: 2026 Annual Report and Appendix 4E (26 August 2026). Lynas figures read on 14 October 2026
- Lynas Rare Earths: Quarterly report for the period ended 30 June 2026 (22 July 2026). Read on 14 October 2026
- Lynas Rare Earths: Quarterly report for the period ended 31 March 2026. Still the source for the samarium oxide uses and first-step capacity
- MP Materials: Second quarter 2026 results
- Osaka University: heavy rare earth additions to NdFeB sintered magnets (Materials Transactions 62)
- Physics World: Recycling rare earth permanent magnets (11 March 2024)
- SMM: Global rare earth recycling surges (31 August 2026)
- Global Mining Review: report on the IEA Global Critical Minerals Outlook 2026
- 10 U.S.C. 4872
