Neo Performance Materials Hits Record High in Bonded Magnet Production for Q3

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Neo Performance Materials Hits Record High in Bonded Magnet Production for Q3

Houston, November 11 (Argus) — Canadian rare earth and magnet producer Neo Performance Materials reported record-high sales of bonded neodymium-iron-boron (NdFeB) magnets and traction motor magnetic powders in the third quarter, while also commencing commercial production of sintered magnets in Europe.

Driven by growing demand for cooling fans in artificial intelligence data center servers, bonded magnet sales in its Magnequench business segment increased by 17% year-on-year, reaching their highest level on record. Meanwhile, as Tier 1 automotive component suppliers expanded their supporting supply for electric vehicle production, sales of bonded magnetic powders for traction motors also hit a quarterly record high.

The company did not disclose specific sales volume data for its magnets and magnetic powders.

Neo's sintered magnet plant located in Narva, Estonia, achieved commercial production in September, three years after the project broke ground. Currently, the plant is supplying a Tier 1 supplier of electric vehicle traction motors in Europe. Neo expects that two to three customer projects will enter the commercial production phase by the end of this year.

The plant currently has an annual NdFeB production capacity of approximately 2,000 tons. Neo plans to expand this capacity to around 5,000 tons per year. Of the newly added 3,000 tons per year, at least one-third will be used to meet the demand for the European Union's offshore wind power projects. The company's long-term goal remains to achieve an annual production capacity of 20,000 tons.

This capacity expansion is part of an integrated project with a total investment of approximately USD 450 million. The project has received funding of up to €126 million (approximately USD 140 million) from the EU Innovation Fund. The project also covers rare earth metal production and the upgrade of the Silmet separation plant in Estonia, with an expected construction period of about three years.

Neo expects to triple the light and heavy rare earth separation capacity at the Silmet plant and add separation capabilities for dysprosium, terbium, as well as samarium, yttrium, and gadolinium products.

Currently, the utilization rate of the Silmet plant is approximately 50%, primarily processing light rare earth raw materials. To adapt to new sources of raw materials, the company will temporarily shut down some production lines during the retrofitting of the production lines.

In August, Neo signed a binding term sheet agreement with the French company Carester, which includes the procurement of dysprosium oxide and terbium oxide, as well as the recycling of magnet processing scrap. In September, Neo also reached a preliminary agreement with Rainbow Rare Earths, securing offtake rights for 40% of the praseodymium-neodymium oxide production and 65% of the mixed heavy rare earth carbonate production from its South African project.

Rahim Suleman, CEO of Neo, stated that Europe imports approximately 25,000 tons of permanent magnets annually, with over 90% of the supply coming from a single country or region.

In the gallium market, export restrictions and tightening global supply have driven up prices, bringing record gross profits to this business segment. The company noted that hafnium prices have remained at favorable levels, spot sales have remained stable, and contract sales of hafnium in the fourth quarter are higher than previous levels.

Neo has been increasing its inventory of low-cost hafnium scrap and expects that by early 2027, approximately 70% of its rare metals business sales will be locked in through contracts.

In the third quarter, Neo achieved a net profit of USD 9.4 million and revenues of USD 194 million; compared to a net profit of USD 1.4 million and revenues of USD 122 million in the same period last year.

Sources

• WeChat Official Account (2026-11-11)
• Original link: Neo Performance Materials Hits Record High in Bonded Magnet Production for Q3
• https://mp.weixin.qq.com/s?__biz=MzU1NDM4NjU4NQ==&chksm=fa4fd82edb099426063824362183636f42cf3958c6019a79ac65ecc4ab7167b57769d8817379&idx=2&mid=2247506879&sn=37d21bd2ec0531f26788308a422f4822