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This week, rare earth prices continued to fall. According to the SMM survey, the operating rate of downstream magnetic material companies was lower than that in previous periods. The continuous decline in rare earth oxide prices led to a lack of confidence among sellers, resulting in an increase in cheaper supplies and further declines in market transaction prices.
The rare earth market still showed no significant improvement. It is expected that rare earth prices will continue to run weakly in the future.
Https://x.com/RainbowREarths/status/1795800883172675640
@Bloomberg
's chart shows, the EU gets 100% of its heavy #rareerathelements from China, highlighting the West's reliance on it for #criticalminerals.
We're proud to be part of the movement towards diversifying the #globalsupply.
Source: https://shorturl.at/CB3TK
Another 2million. that's 4 million in two days.
Reetech
If the higher quotas are based on high grading out mining resources then rare earth prices sky rocket in following years. Issuing quotas does not work. We all know what is going on here with China manipulation of supply. Hence why tariffs are likely to be applied to protect non-Chinese producers. How much of the export goes to Russia for building missile systems? We all know China operates on a red card list system annually, where all companies making huge losses are made up under red card payments in January before the Chinese New Year providing they have done everything the Chinese State told them to do. As a consequence, you have cities built where nobody lives there, EV cars that a lot of people do not want to buy. The economy of China is a zombie factory. They have fast manufacturing techniques but as labour reduces even that advantage gradually falls away. China of course ignores and disrespects other countries intellectual property.
China issues mining, smelting and separation quotas annually, typically twice in a year, with 2023 seeing a rare issuance of three batches of quotas.
The quotas are closely monitored by market participants as an indicator of supply.
The mining output quota in 2024 is estimated at 270,000 metric tons, said Chen Zhanheng, vice secretary general at the Association of China Rare Earth Industry, at an industry conference.
That represents a year-on-year rise of nearly 6% from the total mining quota at 255,000 tons in 2023, when the annual growth rate was 21.4%.
Yang Jiawen, an analyst at consultancy Shanghai Metals Market, forecast the total mining output quota this year to rise to 280,000 tons, a rise of 9.8% from 2023.
The 2024 rare earth smelting and separation quota is expected at 254,000 tons, Chen said, a rise of 4.2% from 2023 when the quota grew 20.7% year-on-year.
Beijing in early February unveiled its first rare earths mining quota in 2024 stood at 135,000 tons, 12.5% higher than its first quota of 2023. And the rise is smaller than the 19% year-on-year increase seen in the first quota released in 2023.
"The volumes for the second quota this year will be key and it won't be an easy choice to make for policymakers as the market has yet to shrug off a supply glut because of weaker-than-expected demand so far this year," said an East China-based market insider, requesting anonymity as he is not authorised to speak to the media.
"If the total quota this year is rising at a similar growing pace as 2023, prices will feel more downward pressure."
In the first four months of 2024, China shipped out 18,049.5 tons of rare earths, a year-on-year increase of 10%.
Today we have a buyer. Hopefully a higher low in the technical chart.
Million share buy often precedes a RNS by a week or so.
It was stated that there was a large holder selling from 16p and results fatigue is setting in. Needs the update.
At 10.3p and it still pulls back. God knows what is going on here.
Of course it will happen. How qualitatively and quantitatively - that is the question.
· Successful production of ca. 35kg of mixed rare earth carbonate at the front-end pilot plant in South Africa; this material is being used as feed for the back-end pilot plant in Florida, USA to produce separated rare earth oxides expected in Q2 2024.
· Updated bulk density calculations have increased the Phalaborwa project tonnage by ca. 16% and added over two years to project life; an update to the JORC-compliant Resource is expected in Q2 2024.
Day in south Africa today isn't it🤔?
Musk used to have a big market for his one model of car in China. He thinks by standing up for China they will keep buying it.
Unfortunately for him the Model Y is beaten at every aspect by Chinese cars, looks, features, range.
Somebody has clearly had enough and selling out.
DY6 Metals (ASX:DY6)
+334% based on drilling results. This hasn't happened in a while.
DY6 Metals has several REE + niobium projects in Malawi, Africa.
She made a big fuss about the results of drilling 55 diamond holes for a total of 7000m (that’s a lot).
Many holes showed REE mineralization of more than 1% over 100m depth, indicating a huge ore body. But the REE content of 1-1.5% does not seem so good. For comparison, its neighbor in Malawi Lindian has 3.26%, Linas has about 8%
Moreover, the company did not even drill all these wells, but collected archival samples that were drilled by other companies at different times from 1988 to 2014.
At the end of the 1st quarter of 2024, the company had 3 million cash on its account, with a capitalization of 2 million. And this is not the only example of such estimates.
This seems to indicate strong resale in the overall sector. This is confirmed by the recent takeover of a REE company at a premium of 188% to the market.
BBC News - Musk opposes US tariffs on Chinese electric cars
https://www.bbc.com/news/articles/cq55zd2xjreo
The company has several outputs promised for Q2. If we see a rally soon we know they are on there way.
Talking out of his coolie hat again !
Smartpunter,
everything will depend on the costs and prime cost of the MREC received
The article is out of date, RBW will get 25% higher prices than China due to the new duty that the US government is applying.
And yes, RBW will be THE lowest cost producer in the world.
REETech is always posting positive articles for RBW, he doesn't understand why, but hey ho.
It’s good news that RBWs operating cost will only be $34 / Kg then! That easily puts us in the lowest 12% of producers and probably towards the lower end of that 12%! In fact RBW probably have lower cost than a lot of Chinese producers and they’re not trashing the environment either - they’re cleaning it up! Good times ahead I think. Thanks for posting a positive article for a change REETech!
Who do you work for Reetech? Do you go short using CFDs in the rare earth equity sector and long Chinese producers?
50% of all companies in the REE mining sector outside of China can only be profitable at an NdPr price of $115/kg or higher. Current price is $56/kg.
Industry analysts Benchmark Intelligence calculated that about 50% of all rare earth companies need a price of $115/kg or higher for the main rare earth product, neodymium praseodymium oxide (NdPr), to receive 15% of profits.
Only 12% of companies can have the same profit at a price of $60/kg.
In Q1 2024, 81% of all investments in rare earth projects outside of China were made by government agencies.
Total investment in the REE sector outside of China in the 1st quarter of 2024 is $1.9 billion.
What scenarios do I see for the development of events?
A) Despite all the groans of the world community about China’s hegemony in this market, nothing will change, China will continue to dominate and will crush all companies outside of China with prices, no one will launch production anymore.
B) Prices inside and outside China will be “divided” due to subsidies, artificial restrictions in the form of duties and legislative initiatives.
C) Prices for rare earths will go north, towards $115 per kg NdPr.
I allow a mix of all three options in different proportions. The only question is in what proportions and what to do with it all.
What to do about it?
Go to hotter sectors where prices are already high for the underlying resource (gold, silver, copper, uranium), or look in this sector for those companies that are in the 12% with the lowest operating costs.