[Special Stock] Novatech Achieves World's First Mass Production of Non-Rare Earth Permanent Magnets... A 'Secret Weapon' in US-China Tariff War

Novatech is showing strong performance. As China retaliates against the U.S. reciprocal tariffs, a standoff between the two powers continues. Amid the intensifying U.S.-China tariff war, with China imposing export controls on critical minerals such as rare earth elements, the Ministry of Trade, Industry and Energy has decided to strengthen cooperation with rare earth-holding countries like Australia and closely monitor domestic supply and demand trends.

As of 10:21 a.m. on the 8th, Novatech is trading at 22,550 KRW, up 24.86% from the previous day.

Earlier, the Ministry of Trade, Industry and Energy held an ‘Industrial Supply Chain Inspection Meeting’ chaired by Na Seong-hwa, Director of Industrial Supply Chain Policy, at the Korea Chamber of Commerce and Industry on the previous day to review domestic supply and demand trends and impacts following China’s Ministry of Commerce announcement on rare earth export controls on the 4th. The meeting was attended by related ministries including the Ministry of Economy and Finance and Ministry of Foreign Affairs, relevant companies, associations and organizations, the Materials and Components Supply Chain Center (including KOTRA), the Korea Mining Industry Promotion Agency, and the Rare Metals Center.

China’s export controls target 7 out of 17 rare earth elements: dysprosium, yttrium, samarium, lutetium, scandium, terbium, and gadolinium. This measure adds an export licensing procedure rather than an outright export ban. Similar to previously controlled items such as graphite and gallium, imports into Korea are possible after China’s Ministry of Commerce grants export permission (statutory deadline of 45 days).

Park Ju-young, a researcher at Kiwoom Securities, explained, "After the U.S. imposed reciprocal tariffs on China, China responded by imposing an additional 34% tariff on all U.S.-made products at the same level." He added, "China also announced restrictions on rare earth exports and sanctions on U.S. military and agricultural-livestock companies." He further predicted, "With China’s strong countermeasures, negotiations between the U.S. and China will not be easy."

A research team led by Dr. Park Ji-hoon and Dr. Kim Jong-woo at the Nano Materials Research Division of the Korea Institute of Materials Science (KIMS) has developed next-generation non-rare-earth Mn-Bi (manganese-bismuth) permanent magnet manufacturing technology capable of delivering world-class strong magnetic performance. The team announced that they are currently transferring this technology to Novatech, a leading magnet manufacturing company. If commercialized, it is expected to be the world’s first industrial application of Mn-Bi permanent magnets based on non-rare-earth elements.

The existing permanent magnet industry market has relied heavily on rare earth elements as key materials. It has been significantly affected by China’s rare earth supply policy changes and price volatility, creating an urgent national need for alternative technologies that can deliver high performance without rare earths. To achieve strong magnetism, Mn-Bi powder must maintain a low-temperature phase (LTP) with high purity, but during the sintering process (compressing powder into a solid block at high temperature), it easily oxidizes or decomposes, lowering purity and limiting performance.

The KIMS research team overcame these limitations by developing Mn-Bi non-rare-earth permanent magnet manufacturing technology. They demonstrated stable realization of a maximum energy product of 10.5 MGOe (mega-gauss-oersted), proving it to be world-class. This technology can be applied to various industries such as electric vehicle motors, generators, and semiconductor components, enabling miniaturization and efficiency improvements of motors that previously used ferrite (iron oxide) magnets. Most importantly, it can replace expensive rare earth permanent magnets, expected to create enormous economic value not only domestically but also in the global market.

The research team is collaborating with Novatech to establish pilot-scale production equipment and optimize processes for mass production and commercialization. They aim to achieve a maximum energy product of 12 MGOe through continuous research and development going forward.