Rare Earth Demand Skyrockets -- Molycorp and Rare Element Resources Poised to Benefit

创建时间：2011-10-18 00:00

Rare earths came under the spotlight two years ago after

China

started to reduce export quotas. Beijing's influence aroused concern when exports of rare earths to

Japan

were temporarily suspended after a diplomatic dispute.

China

has continued clamping down on production and sale of rare earth elements, citing a need to clean up highly polluting production processes and to stop illegal exports. Beijing said it cracked down on smuggling of rare earths and impose quotas for exports of rare earth alloy products as part of its campaign to strengthen control over the sector.

Statistics collected in Hong Kong show exports of rare earth metals have shrunk in half over the past year. Over the same period, the value of exports has soared to more than $121,000 per tonne, a 10-fold jump from a year ago.

Mark Smith, CEO of Molycorp, explains that "unless alternative sources for rare earths are brought on, we are going to have a very significant shortfall in terms of how much material is available versus how much we need." Molycorp plans to double production in its California mine by the end of 2013. Presently Molycorp's Mountain Pass mine produces about 3 percent of the world's rare earths from stockpiled concentrate, but the company plans to eventually turn out a quarter of the total supply.

Earlier this month Molycorp announced that it discovered a heavy rare earth ore deposit on mining claims it owns near one of its facilities in southern California. While some of the light rare earths, like neodymium and cerium may have greater demand, the heavy rare earths are more valuable.

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