Neodymium supply chain: where the real bottlenecks are (and why Nd is a magnet-chain story)

Neodymium is typically produced as part of mixed rare earth concentrates from deposits like:

• • carbonatites (often LREE-heavy, including Nd and Pr)
• • mineral sands monazite (depends on feed mix and processing route)
• • other mixed REE ores

The key point: mines rarely "produce neodymium" directly. They produce concentrates or mixed intermediates that must go through chemical processing and separation. The IEA notes that China's dominance is larger at separation and refining than at mining, which is exactly why mines alone do not fix Nd supply risk.

Before you can separate neodymium, you have to:

• • chemically digest the mineral concentrate (acid/alkali routes vary by mineralogy),
• • remove impurities,
• • create a process liquor clean enough for separation.

This stage drives a lot of capex/opex and permitting difficulty, and it is where "rare earth projects" often stall in practice.

Rare earth separation is hard because lanthanides are chemically similar, and the market is dominated by operators with long-optimized circuits.

For magnet rare earths (Nd, Pr, plus Dy and Tb), the IEA highlights extreme concentration in separation and refining, with China representing about 91% of global production, with Malaysia far behind.

This is why "we have a mine" does not automatically translate into "we have neodymium oxide at spec, at scale."

Magnet producers do not want "neodymium oxide" as an end product. They need:

• • neodymium (and praseodymium) metal,
• • then specific alloys (Nd-Fe-B system),
• • with tight control of impurities that can wreck magnetic performance.

This is a midstream capability stack that is smaller and more specialized than most mining narratives admit.

NdFeB magnets are the dominant high-performance permanent magnet type used in EV traction motors and many wind turbine generator designs, and they sit at the center of the clean-energy hardware stack.

The IEA explicitly tracks "magnet rare earth" project pipelines across mining, refining, and magnet manufacturing capacity, which tells you what matters: you need the chain, not a single node.

Why this stage is sticky

• • Qualification and consistency matter (OEMs do not switch magnet suppliers quickly).
• • Tooling and powder metallurgy know-how are barriers, not commodities.
• • Policy can hit magnets even when "neodymium itself" is not directly restricted.

CSIS describes China's rare earth and permanent magnet export controls as among the strictest, with direct implications for downstream users and defense-adjacent supply chains. Even policy summaries note that restrictions can bite via the product category (magnets) rather than only via a single element list.

A lot of neodymium exposure arrives as magnets embedded in finished goods (motors, electronics, devices), not as raw material imports. The USGS highlights that significant amounts of rare earths are imported as permanent magnets embedded in finished goods.

This matters because it changes the risk model:

A country can import "products" while still being strategically dependent on magnet supply.