Lynas in Disconnect: NdPr Rally Surges While Shares Lag

Rare-earth prices are climbing, but Lynas shares aren?t keeping pace with the commodity rally. The latest snapshot: NdPr oxide is hitting multi?year highs, while the stock has recently trailed the underlying material trend. What explains the gap between the fundamentals and the share price?

• NdPr price: 1,065,000 CNY per tonne (as of Wednesday), +34.38% in the month, +94.52% year over year
• Shares: last at 16.00 AUD (as of Wednesday)
• Operational: revenue noticeably higher, but quarterly production clearly weaker

NdPr oxide is a cornerstone material for permanent magnets, essential in EV motors and wind turbines. Trading Economics shows the neodymium price at 1,065,000 CNY per tonne on Wednesday?the strongest level in nearly three years.

Several forces are driving the rally in tandem: a tight supply backdrop, robust demand from sectors like electric vehicles, robotics, defense, and electronics, and limited additional capacity outside China. Political support is also helping: Western governments are pushing for non?Chinese materials through their industrial policies.

Why the shares haven?t moved in step

Despite the strong commodity backdrop, Lynas?s stock has not advanced as quickly as the NdPr fundamentals in recent weeks. On Tuesday, the shares closed at 15.76 AUD (+4.10%). On Wednesday, they were quoted at 16.00 AUD (+1.59%). Year to date, the equity is up about 26.69% per Intelligent Investor, and over the past 12 months it has gained roughly 128%.

Two factors are cited for the disconnect:

• First, a broader selloff in commodity equities sparked by sharp corrections in precious metals?especially silver?late in January. The reaction was sectorwide, with limited differentiation among names.
• Second, policy uncertainty in the United States. Media reports citing US officials suggest future support for critical minerals may come through targeted investments rather than explicit price guarantees. Canaccord Genuity noted in late January that Washington appears to be moving toward selective tariffs and concrete off?take agreements, rather than broad price guarantees.

Q2 update: Revenue up, production down

For the second quarter of the fiscal year (ending December 2025), Lynas delivered a mixed picture. Revenue rose 43% to AUD 201.9 million. The average selling price climbed to AUD 85.60 per kilogram, up from AUD 49.20 in the prior-year period.

Should investors sell immediately? Or is it worth buying Lynas?

On the operational front, headwinds persisted: power outages at the Kalgoorlie site in Western Australia slowed production. Total production of Rare Earth Oxides dropped to 2,382 tonnes, from 3,993 tonnes in the previous quarter.

US strategy and leadership change as additional factors

The report highlights a strategic shift in the United States. The government has recently provided substantial funding to bolster a domestic rare-earth supply chain and has supported competitors like USA Rare Earth, altering the competitive dynamics for projects and roles in the US market.

Also impacting sentiment is the announced leadership transition: CEO Amanda Lacaze plans to retire after 12 years at the helm, with departure scheduled for January 2026.

In summary, Lynas?s trajectory will likely hinge on three key elements: executing through the production-related challenges, ensuring a smooth leadership transition, and maintaining influence within Western supply-chain initiatives for critical minerals.

Ad

Lynas Stock: New Analysis - 13 February

Fresh Lynas information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

Read our updated Lynas analysis...