FAST NEWS: JL Mag to Build Magnetic Steel Composite Recycling Project in Mexico

The latest: High-performance rare earth materials maker JL Mag Rare-Earth Co. Ltd. (6680.HK; 300748.SZ) announced on Tuesday it will invest $100 million to build a comprehensive project to process waste neodymium (NdFeB) magnetic material in Mexico.

Looking up: The company believes growing demand for rare earth permanent magnetic materials and the increasing amount of NdFeB waste magnets overseas will promote large scale recycling of such resources, thereby promoting the sustainable development of rare earth resources.

Take Note: The project will take up to three years to complete. Differences in the legal, policy and business environments in Mexico from China could create uncertainties in related planning, approval and construction progress.

Digging Deeper: JL Mag is a state-owned producer of high-performance rare earth permanent magnetic materials. It was listed in Shenzhen in 2018 and completed its Hong Kong IPO earlier this year, with a “dual primary listing” status on both exchanges. The company’s main products are rare earth permanent magnets that are an alloy of rare earth and other metals, which are magnetized by a magnetic field to produce material that can be used in products such as new energy vehicles, wind turbines and energy-saving inverter air conditioners. According to market data in the company’s Hong Kong IPO prospectus, JL Mag’s controls 14.5% of the global market for high-performance rare earth permanent magnets, ranking first in the world.

Market Reaction: JL Mag’s shares drifted on Tuesday morning and closed 0.3% lower at HK$30.95 at the midday break, 8.4% below their IPO price of HK$33.80.

Translation by Jony Ho

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