Magnet Rare Earths
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Magnet rare earths are the elements that make the strongest permanent magnets: neodymium and praseodymium in neodymium-iron-boron magnets, dysprosium and terbium added for high-temperature performance, and samarium in samarium-cobalt magnets. The EU names seven of them, neodymium, praseodymium, terbium, dysprosium, gadolinium, samarium and cerium, as strategic raw materials. Magnets are the leading global use of rare earths, and the International Energy Agency says rare earths are about 40% of a permanent magnet's cost.
about 40%
of a permanent magnet's cost is rare earths, though under 1% of a vehicle's value
$1,010 and $239
average 2025 prices per kilogram of terbium and dysprosium oxide
Which rare earths go into magnets, and what does each do?
Each magnet element has a distinct role. The table gives the role, the 2025 oxide price and the latest supply fact.
| Element | Role | Oxide price 2025 | Supply fact |
|---|---|---|---|
| Neodymium (Nd) | Main rare earth in neodymium-iron-boron magnets | $73/kg | Lynas and MP Materials are the main producers outside China: 1,857 t of NdPr (Lynas) and 840 t (MP), both in the June 2026 quarter (Lynas, MP) |
| Praseodymium (Pr) | Partner of neodymium, usually sold with it as NdPr | $74/kg (NdPr $69/kg) | Priced and sold together with neodymium; floors of $110/kg NdPr exist in US and Japanese supply deals |
| Dysprosium (Dy) | Added to neodymium magnets so they resist demagnetisation at high temperature | $239/kg | China produced over 99% of refined dysprosium and terbium in recent years (Adamas) |
| Terbium (Tb) | Same role as dysprosium; scarcer and costlier | $1,010/kg | Lynas produced 19 t of dysprosium and terbium combined in the June 2026 quarter |
| Samarium (Sm) | Samarium-cobalt magnets for high-temperature environments | $2.82/kg | Lynas began producing samarium oxide in March 2026, with first-step capacity of about 400 t a year |
| Gadolinium (Gd) and cerium (Ce) | Named as magnet rare earths in EU Annex I | Gd $30/kg, Ce $1.71/kg | MP Materials signed a long-term offtake for separated gadolinium with a US aerospace and defense customer in 2026 |
Sources: USGS rare earths and USGS heavy rare earths for prices; Regulation (EU) 2024/1252; MP Materials Q2 2026; Lynas June 2026 quarterly report and March 2026 quarterly report (samarium capacity). Prices are Chinese-origin averages free on board.
Why are dysprosium and terbium added to magnets?
Dysprosium and terbium are added because they raise a neodymium magnet's coercivity, its resistance to demagnetisation, which is needed in hot environments such as traction motors. Research from Osaka University notes that adding either element raises coercivity but lowers the maximum energy product because it reduces remanence, and describes grain boundary diffusion, in which the heavy element is diffused in from the magnet surface, as an effective way to raise coercivity. Terbium costs far more than dysprosium: the USGS reports $1,010 against $239 per kilogram for the oxides in 2025. The USGS notes that light rare earths can substitute for heavy ones in several applications, so demand for the heavy elements is partly a design choice.
What are the supply risks?
The supply risk is concentrated in refining and in the heavy elements. China refines nearly all dysprosium and terbium and, according to the Congressional Research Service, makes about 94% of rare earth magnets. Outside China the Lynas Malaysia plant is the only commercial producer of separated light and heavy oxides, by Lynas's own account, and MP Materials received a $150 million Department of War loan in August 2025 to build a heavy rare earth separation facility at Mountain Pass. On the policy side, China has licensed dysprosium, terbium and samarium since April 2025, the US Department of Defense will not buy covered Chinese-origin magnets from 1 January 2027, and governments have set price floors of $110 per kilogram of NdPr in the MP Materials deal and in Lynas's agreements with Japan and the US government. See permanent magnets, magnet makers and offtake agreements.
Frequently asked questions
Which rare earths are used in magnets?
The rare earths used in magnets are neodymium and praseodymium in neodymium-iron-boron magnets, dysprosium and terbium added for high-temperature performance, and samarium in samarium-cobalt magnets. The EU also lists gadolinium and cerium as magnet rare earths.
Why is dysprosium added to neodymium magnets?
Dysprosium is added to neodymium magnets to raise their coercivity so they keep their magnetism at high temperatures. The trade-off is a lower maximum energy product, according to research from Osaka University on grain boundary diffusion of dysprosium.
How much of a magnet's cost is rare earths?
Rare earths are about 40% of a permanent magnet's cost according to the IEA, even though they are under 1% of a vehicle's value. The price depends mainly on neodymium-praseodymium oxide, which averaged $69 per kilogram in 2025.
Who makes rare earth magnets?
China makes about 94% of rare earth magnets according to the Congressional Research Service. Plants outside China include Neo Performance Materials in Estonia and eVAC in South Carolina, each with about 2,000 tonnes a year of capacity.
Sources
Read on October 12, 2026. Figures on this page come from these documents; where a number is an estimate, the source says so.
- USGS Mineral Commodity Summaries 2026: Rare earths and rare earths (heavy)
- Global Mining Review: report on the IEA Global Critical Minerals Outlook 2026
- Lynas Rare Earths: 2026 Annual Report and Appendix 4E (26 August 2026). 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 first-step samarium capacity
- MP Materials: Second quarter 2026 results
- Congressional Research Service: Rare Earth Elements and U.S. Supply Chains (IF13171)
- Osaka University: heavy rare earth additions to NdFeB sintered magnets (Materials Transactions 62)
- Adamas Intelligence: Rare Earth Magnet Market Outlook, top predictions for 2026
- Regulation (EU) 2024/1252, Annex I
