The State of the Magnetics Industry as of November, 2025

The global magnetics industry—especially the rare-earth permanent magnet and neodymium-iron-boron (NdFeB) magnet sectors—is in a period of heightened strategic importance, moderate growth, supply-chain tension and technological transition. Below is a detailed overview of where things stand (and where they look headed) for players such as your company, Radial Magnets, operating in manufacture, supply, and global sourcing of permanent magnets.

Market size, growth and demand drivers

Size and growth

The global rare‐earth magnet market was valued at around US $19.5 billion in 2024.
Forecasts expect the rare‐earth magnet market to grow at a CAGR in the 6-9 % range between now and ~2030. For example, one estimate shows growth at ~7.7 % to reach USD ~40.5 billion by 2034.
The market for neodymium magnets (a key subset) likewise shows strong growth potential. For example one report shows the Nd market of USD 5.52 billion in 2023 and growing to ~USD 8.77 billion by 2032 (~5.3 % CAGR) in one scenario.
In terms of volume-growth of rare-earth magnets in 2025, one commentary suggests demand growth closer to ~5 % rather than the 9 % previously expected.

Demand drivers

Electrification and EVs: As electric vehicles proliferate, the number and size of high‐performance permanent magnets (especially NdFeB) used in motor drives rises. For instance, one commentary notes nearly all EVs sold since 2017 incorporate rare‐earth powered motors.
Renewables & wind turbines: Large wind‐turbine generators increasingly use high‐performance magnets (e.g., for direct-drive generators). Reports indicate that growth in wind power is a key magnet driver.
Automation, robotics, industrial & consumer electronics: Miniaturisation (e.g., in smartphones, audio equipment, sensors) and automation in manufacturing raise magnet use in volume. For example, the forecast to 2040 of NdFeB magnets includes robotics and advanced air mobility as drivers.
Defense and aerospace: High‐end magnet applications (actuators, sensors, precision motors) are influenced by national security and defense spending.
Supply‐chain diversification: Because rare‐earth magnets are strategically critical, firms are investing in domestic capacity, recycling, and alternative chemistry, which creates incremental demand for new production/processing.

Key observations for 2025

While demand is strong, growth is moderating relative to earlier expectations (for example from ~9 % to ~5 % in 2025) due to macro‐headwinds (China economic softness, material price volatility).
Raw‐material (rare‐earth element) price trends have recently surged (or rebounded) after earlier declines. For instance Neodymium’s benchmark price is up ~28.9 % year-on-year as of late October 2025.

Supply-chain, geopolitics & materials risk

China’s dominance and export controls

China remains by far the dominant player in rare‐earth extraction, refining and permanent magnet manufacturing—often cited at ~90 % refining share and ~70 % of mined output.
In 2025, export licensing, quotas and scrutiny from Chinese authorities have become increasingly used as policy tools. For example, companies report delays or rejections in export applications of rare‐earth magnets.
Supply‐chain pressure is increasing. One Reuters article quotes automakers “in full panic” over rare‐earth magnet bottlenecks and their reliance on China-origin material.

Diversification and reshoring efforts

Western governments and companies are actively pursuing reshoring, localisation and recycling of rare‐earth magnets and materials. For example, an EU‐funded magnet plant in Estonia aims to secure non-Chinese supply.
India approved a large scheme (~Rs 7,300 crore) in Oct 2025 to support domestic manufacturing of rare‐earth magnets.
This supply‐chain rebalancing is increasingly seen as urgent by magnet manufacturers, EV OEMs and wind‐turbine producers.

Material and cost pressures

Neodymium and praseodymium (Nd/Pr) feedstock cost volatility remains a major risk. While previous peaks in 2022 subsided, prices are now rising again.
The difficulty of building new mines, refining capacity and magnet-production lines means supply cannot ramp overnight. Several forecasts warn of mismatch between magnet demand (especially for EVs) and rare‐earth supply mid-to-late-2020s.

Technological trends and magnet innovation

Magnet design is becoming more advanced: higher‐grade NdFeB magnets, improved coatings (corrosion resistance, high‐temperature performance), bonded vs sintered magnet mixes.
Alternative magnet systems (fewer or no heavy rare‐earth elements like dysprosium) are increasingly being developed, partly to address supply constraints and cost. For example, automakers exploring magnet systems with less dependency on heavy rare earths.
Recycling of rare‐earth magnets and magnet materials is gaining traction—both for environmental compliance and supply security.
Manufacturing trends: higher automation in magnet production, improved AOI (automated optical inspection) and calibration, tighter tolerances, especially for high-end applications (EV motors, aerospace).
Emergence of new application domains (e.g., advanced air mobility/EV vertical take-off vehicles, robotics, more refined sensor/actuator systems) which place premium on compact and powerful magnets.

Regional outlook & competitive dynamics

Asia-Pacific

Asia-Pacific remains the largest region by demand (automotive, electronics, consumer goods) and by production. For example, high demand for rare‐earth magnets in China and other Asian countries.
China is also continuing to invest in upgrading its magnet manufacturing ecosystem, though export restrictions create uncertainty for non-Chinese buyers.

North America & Europe

Both regions are under pressure to secure supply chains for magnets and rare earths. Europe’s Critical Raw Materials Act and new magnet plants reflect this.
North America is pushing for on-shore refining, magnet manufacturing and recycling capacity.
Magnet manufacturers outside China may face pricing pressure (higher feedstock cost, smaller scale) but also opportunity (premium supply, non-Chinese origin credentials).

Key risks & strategic considerations

Feedstock risk: Disruptions in rare-earth mining/refining (especially in China), export quotas/licences, price spikes.
Geopolitical risk: Trade wars, export restrictions, national security concerns. Magnet and rare-earth supply chains are increasingly considered strategic.
Technology substitution risk: Alternatives to rare-earth magnets (e.g., induction motors without rare earths, ferrite magnets, advanced ceramics) could reduce demand segments—though presently high‐performance NdFeB remains dominant.
Overcapacity / margin compression: If new magnet manufacturing capacity emerges in lower-cost regions, margin pressure may increase.
Regulation & ESG pressure: Environmental/community issues in rare‐earth mining, pressure for low-carbon manufacturing, traceability (e.g., forced labour aspects) will impact sourcing and remanufacturing strategies.
Customer demand uncertainty / EV growth pace: If EV adoption or wind‐turbine build rates slow (due to macroeconomic issues or supply constraints), magnet demand could soften.
Inventory risk: Holding high-cost inventory of rare‐earth magnet feedstock or finished magnets may expose firms to price drops or obsolescence.

Outlook to 2028 and beyond

The magnetics industry will continue to grow steadily. Demand from EVs, renewables, robotics, aerospace will sustain moderate to strong growth (mid single-digit to low double-digit CAGR depending on segment).
Supply side will be under pressure: shortages of certain rare‐earth elements, bottlenecks in refining and magnet production, especially if EV/renewable build-rates accelerate faster than supply ramps.
Over the next 3-5 years, magnet manufacturers with flexible global footprints (China + US), diversified sourcing and technical differentiation will outperform commodity producers.
Strategic value of magnets in decarbonisation and defence will increase; governments will treat magnet supply as critical infrastructure.
Risk of disruption (exports, price spikes, trade conflict) will remain elevated; companies that proactively manage risk will gain competitive advantage.

Conclusion

For the magnetics industry as of November 2025, the picture is one of structural growth aligned with electrification and renewables, but anchored on complex and geopolitically sensitive supply chains. While market growth is not exploding at double-digits across all segments (some moderation is evident), the strategic importance of magnets continues to rise, making this a critical period to invest in risk-mitigation, upstream positioning, and technical leadership.