- Dysprosium oxide prices moved higher in early Q1’26 as heavy rare earth supply stayed tight in China and export-control concerns supported market sentiment.
- Controlled mining, smelting, and separation activity restricted upstream availability, with China holding 61% of the mined rare earth supply and 91% of refining capacity.
- Magnet producers purchased cautiously, with demand tied to EVs, motors, electronics, and industrial applications, which limited stronger gains later in the quarter.
Dysprosium oxide prices in China strengthened during Q1’26, supported by tight heavy rare earth supply, cautious selling by raw material holders, and policy-related export uncertainty. Upstream availability remained constrained by controlled mining and separation activity, making the market sensitive to restocking from magnet manufacturers. However, the Iran war and Strait of Hormuz closure added indirect pressure through energy and freight risk, as tanker traffic through Hormuz fell 40%-50%, with crude and refined product flows at 20.4 million b/d compared with 21.2 million b/d in January. This indirectly supported dysprosium oxide prices by raising energy and freight risk across industrial supply chains, which increased production and logistics uncertainty for rare earth processors. This encouraged cautious restocking in the dysprosium oxide market, helping prices stay firm, though the impact was limited as the commodity’s main price drivers remained China’s tight heavy rare earth supply and controlled downstream buying.