What impact will Myanmar’s export tax have on rare earth prices?

Earlier this week, the Kachin Independence Army (KIA), which seized control of key mining sites in Myanmar late last year, reportedly told miners in Kachin state it will allow shipments of existing rare earth inventories to China from today, but it will levy a tax of 35,000 yuan ($4,800) per tonne of material, Reuters reported.

Exports from Myanmar to China plummeted from September through December of last year and have since been volatile in 2025 to-date.

Mining operations came to a near standstill in October following the KIA’s takeover yet Chinese customs data shows that rare earth concentrate exports from Myanmar to China have continued, albeit at reduced levels, presumably from existing inventories.

This begs the questions – what’s left in Myanmar’s existing inventories, and what impact will the new KIA tax have on export prices in the near-term?

To the former question, we estimate Myanmar’s remaining inventories entail hundreds-to-low-thousands of tonnes of concentrate (primarily mixed rare earth oxide), relatively insignificant amounts that will do little to quench demand from China’s rare earth processors should mine output not resume imminently.

To the latter question, in February 2025, the average price of Myanmar’s mixed rare earth oxide exports to China was $24.71 per kilogram.

The new KIA tax of $4,800 per tonne ($4.80 per kilogram) from today would increase that price by 19% to $29.51 per kilogram and likely percolate through to a comparable increase in prices of dysprosium, terbium and other rare earths of economic significance in Myanmar’s concentrate.

If mining remains disrupted, the tax’s impact on downstream prices will likely be limited due to low export volumes. If operations resume and the tax persists, higher export volumes could amplify the price effect.

China’s rare earth processors are expected to accept the tax in the short term due to limited other options.

Over time, the tax could encourage the KIA to sustain mining, a cost China might tolerate to secure supply.

Yet, for China – seen as a supporter of Myanmar’s military government since the coup – this tax paid to rebels poses a dilemma and risks tainting the magnet supply chain reliant on Myanmar’s rare earths.

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2025년 9월 토론토에서 열리는 ‘Rare Earth Mines, Magnets & Motors 2025’ 행사에 여러분을 초대합니다. 이 자리에서 업계 최고의 전문가들과 함께 이 주제를 심도 있게 다룰 예정입니다.

이틀간 진행되는 이번 행사에는 전 세계 광산에서 OEM에 이르는 공급망 전반의 비즈니스 및 기술 리더들이 한자리에 모여 5성급 호텔에서 수준 높은 토론과 네트워킹의 기회를 가질 예정입니다.

올해 컨퍼런스의 주요 주제는 로봇공학, 자동화, 첨단 항공 이동성, 그리고 상류 단계에서 통합되고 있는 신흥 ‘광산에서 자석까지’ 공급망 등이 될 것입니다.

특별 게스트: 애플의 공동 창업자 스티브 워즈니악

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