(Bloomberg) -- Rare-earth prices are spiking in China, with the grades used to make permanent magnets surging to their highest level in over a decade amid supply tightness.
Prices of praseodymium-neodymium oxide, or NdPr -- two of the 17 rare earth elements that are used in NdFeB magnets -- spiked to 735,000 yuan ($115,000) a metric ton as of Thursday, the highest since November 2011, according to data from Shanghai Steelhome E-Commerce. Prices have almost doubled this year.
A domestic shortage of rare earths is looming as China, which accounts for 70% of global production, uses quotas to preserve the strategic material used in everything from phones to computers to new-energy vehicles. The nation's power shortage has also exacerbated supply disruptions, while surging commodity prices are increasing production costs.
READ MORE: Commodities Index Hits Record as World Rebound Meets Shortages
Still, the price surge has deterred some demand, with magnets producers hesitating to make purchases, researcher Mysteel said in a note.
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