Rare Earth ETF's 3.8% Rebound Masks a Deeper Riddle: Metal Prices Up 23%, Mining Stocks Down 28%
Published on 10/28/2026 at 11:31 | Editorial boerse-global.de
The VanEck Rare Earth ETF (ISIN IE0002PG6CA6) climbed 3.8% to EUR 9.59 on Tuesday, riding a broad rally across critical-minerals and rare-earth equities rather than any fund-specific news. United States Antimony and USA Rare Earth each jumped 11%, Critical Metals added 8%, and the US-listed VanEck REMX fund, which tracks the same sector, rose roughly 4%. No single catalyst was identified for the sector-wide bid — it behaved as one coordinated wave of demand across the commodity group.
One stock-specific headline fed the mood: Australia offered Energy Fuels conditional financing of AUD 126 million for its Donald rare-earth project, lifting that company's shares the same day.
A Sector Decoupling From Its Own Commodity
Tuesday's gain sits atop a far more puzzling backdrop. Canaccord research cited Monday via Wall Street Logic found that neodymium-praseodymium oxide prices outside China have risen 23% since the start of the year — yet the producers Canaccord tracks have fallen an average of 28% over the same stretch, with development companies down about 17%. That gap is unusual for a sector long marketed as a leveraged play on rising commodity prices. The report points not to fresh weakness in spot prices but to a structural mismatch: investors appear unwilling to trust the higher quotes, or they are weighting other risks more heavily.
For the VanEck fund, a basket of exactly these mining and processing firms, that divergence explains part of its persistent softness, independent of any fund-level event.
Should investors sell immediately? Or is it worth buying VanEck Seltene Erden ETF?
China offers a contradictory picture. On Friday, Chinese shares of rare-earth permanent-magnet makers closed 2% higher, according to Shanghai Metals Market, driven by the humanoid-robotics theme and positive first-three-quarter profit forecasts from China Northern Rare Earth, China Rare Earth and Shenghe Resources. Spot rare-earth prices slipped that same day, so the equity rally was not backed by stronger physical demand. A separate weekly report described a lower price center for praseodymium-neodymium alongside diverging moves in other elements such as gadolinium and holmium.
Supply Chains Remain the Open Question
Alongside the price action, signals are mounting that Western buyers want to cut their dependence on Chinese rare earths. General Motors has cancelled its long-term supply agreement with Vacuumschmelze for magnets from a planned US plant, according to Reuters, and the parties are now in arbitration. Reuters also reported that Taiwan Semiconductor Manufacturing Co. has asked equipment suppliers for alternatives to rare-earth-containing components in fab machinery, aiming to reduce exposure to Chinese export controls.
On the policy front, a longer-term perspective is emerging. Benjamin Gallezot, France's interministerial delegate for strategic minerals and metals supply, said Western countries could reach an "acceptable" level of diversification away from China within three to five years, pointing to projects in Belgium, France, Australia, the US, Japan, Brazil and India — though he named magnet manufacturing as a possible bottleneck.
Trade data underscores the shift. Silverado Policy Accelerator reported that China's September exports of controlled rare-earth compounds and metals fell worldwide to 122 tonnes, down from 143 tonnes in August. Exports bound for the US rose from 6 to 38 tonnes, but magnet shipments to America totaled 4,637 tonnes in the first nine months of the year, roughly 15% below the 2024 comparable figure.
Chart Still Bruised
Despite the recent bounce, the fund remains well below where it started the year, with a year-to-date loss of 24%. It sits 49% below its 52-week high of EUR 18.76, reached in May. An RSI of 34.3 shows the fund has not yet entered overbought territory after the past few sessions' recovery, while annualized volatility of 29% underlines how sharply individual sector headlines — the Energy Fuels financing pledge, TSMC's response to export risk — can still move the price.
That mix of rising material prices and fraying structural demand certainty goes a long way toward explaining why the fund's recovery has so far been halting.
Ad
VanEck Seltene Erden ETF Stock: New Analysis - 28 October
Fresh VanEck Seltene Erden ETF information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
