Lynas Survival a 50-50 Proposition, says Rare-Earths Expert

Rare Earth Deposits & Mining / Rare Earth Exploration, Mining, Processing, & Uses

Date posted: 01/08/15

Rick Wallace reports that a rare earth metals expert has rated the survival of Australian producer, Lynas, as a 50-50 proposition, warning that although the company was now well managed, low prices for its output mean it was vulnerable to being taken over by a Japanese or Korean company. Rare metals specialist Jack Lifton shrugged off recent moves from China to scrap rare earth export quotas, saying it was just designed to please the World Trade Organisation and would not ­really affect how much was exported from China. The Technology Metals Research founder said prices remained stubbornly low for many rare earth elements and there was no guarantee Lynas, a former market darling, would survive the current slump. Although he thinks Lynas today is very well managed. He do not say that Lynas is making money but they are doing better than US rival, Molycorp. There are a lot of people talking about making a run for Lynas and Molycorp. Koreans and Japanese would be at the forefront. Lynas has been under heavy selling pressure amid a broad slump in the listed rare earth sector that scaled dizzying heights in 2011 as exports out of China dried up amid new export restrictions, only to crash back to earth when shipments resumed. Lynas stock value, which traded at more than 2.50 dollars in 2011, initially dropped 8 per cent on the reports out of China down 6.2 cents but managed to hold that level yesterday. Lynas chief executive Amanda Lacaze told The Australian she agreed with Mr Lifton that the Chinese move would not affect prices and the language out of China has been about creating a market that is more orderly and has more value.