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Gareth Hatch  

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  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    Siemens has reduced the amount of HREEs such as dysprosium required in the magnets that they use, but those magnets still require approx. 30% by weight LREEs (neodymium and praseodymium).
    Apr 21, 2015. 09:16 AM | 4 Likes Like |Link to Comment
  • Apple's Dirty Little Rare Earth Secret: Follow-Up Points [View article]
    Great Western Minerals Group owns REE deposits in Canada and South Africa. The former are nothing more than that; the latter is a former thorium-producing mine that has a long way to go before it can be made operational again. The REEs "processed" at the Less Common Metals facility are imported from China.
    Mar 6, 2015. 05:12 PM | Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    I'm not sure myself...
    Feb 14, 2015. 11:58 AM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    @The Critical Investor: There were two scenarios examined - a ramp up of MCP output was one, achieving 20 kt was the other. Point was to show the effects of either, not to make a prediction as to which is the more likely.

    On pricing: not sure what you're asking… anything prior to the present date is based on historical pricing.

    On who buys: anyone that wants this type of in-depth information. Primary audience is likely to be junior-mining companies, institutional and other investors, government agencies etc. At current FX rates the report is less than USD 4,900. Compared to the cost of certain other reports, or the cost of gathering this type of information oneself (or hiring someone to do it), it's an absolute bargain.
    Nov 29, 2014. 07:22 PM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    There are a variety of services that provide the information, on the basis of HS codes. Example web sites include http://www.gtis.com and http://comtrade.un.org . To get anything useful you generally need to pay for access to the more detailed stats.
    Nov 3, 2014. 09:58 AM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    I look at datasets that cross-reference stated Chinese export numbers to numbers published by importing countries. I talk to end users. The story from each of these sources does not match a "decreasing demand" narrative. Interpret that as you will :-)
    Nov 2, 2014. 11:56 PM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    I see the logic in your last paragraph, as it applies to producers, especially if it is the producers doing the warehousing, not the traders.
    Oct 29, 2014. 09:11 AM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    Not quite sure I understand your first question - what do you mean by "no Chinese Customs figure"?.

    As for your second: my experience is that Japanese (and Chinese) traders are _very_ reluctant to spill the beans on anything. I also doubt that they're losing money, since, among other reasons, these guys (traders now, not producers) generally don't buy and warehouse material, but essentially broker it, for a fee / commission.
    Oct 27, 2014. 09:12 AM | 5 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    So the logic here is that because the "ROW just switched", demand decreased, and prices went down, right?

    So why is it that this year, with ROW demand increasing, prices have continued to fall?
    Oct 26, 2014. 05:57 PM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    THe main issue is that the author cites a bunch of references, authored by folks who themselves, in various cases, are simply not accurate in their assessment.

    Some specific points:

    - The assertion on page 1 that "China's advantages in the rare earths market" were slipping away in 2010 as a result of "increases in non-Chinese production and processing capacity" doesn't stand up to scrutiny - the author erroneously equates potential capacity with actual output, and does so repeatedly throughout the rest of the paper.

    - the assertion that the market response was "largely successful" despite there still being no appreciable heavy REE production outside of China, and the lack of a dip in demand for heavies for certain applications;

    - It was the export-quota announcement in the middle of 2010 that was the real catalyst for the panic that ensued (not the alleged embargo of Japan by China);

    - Little acknowledgement of the tremendous time-scale differences between demand-side and supply-side responsiveness;

    - The assertion that the problem was basically solved by altering products to require less REEs (true in a handful of cases but not the case for Nd and Pr for magnets, or various other REEs for phosphors and ceramics);

    - The author claims that the magnet makers responded by reducing REE content in their magnets - not true. they reduced the content of certain REEs like Dy and Tb, but that actually increased the amount of Nd and Pr present;

    and on and on.
    Oct 25, 2014. 11:00 AM | 8 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    @motionstream: there are a number of basic inaccuracies in that report that raise questions about the rest of it.
    Oct 24, 2014. 12:10 PM | 4 Likes Like |Link to Comment
  • Uncertainty Still Surrounds Molycorp [View article]
    @End Game: I focused on the Resource segment because that segment is still under development, and is the primary beneficiary of the proceeds of recent financing.
    Aug 29, 2014. 01:27 PM | Likes Like |Link to Comment
  • Uncertainty Still Surrounds Molycorp [View article]
    Molycorp and Lynas were both well underway with their projects, before the major price spikes that started in the middle of 2010 and which peaked in the middle of 2011. Their original business models never relied on those peak prices because they were created long before they occurred. Current prices for rare earths are still significantly higher than they were prior to 2010, and have plateaued considerably since the price spikes. Therefore this tendency to compare current prices to the peak prices of 2011 can be misleading.

    Per the company's Q2 2014 financial results, Molycorp's Mountain Pass mine and processing facility sold materials with an average selling price [ASP] of $10.30 / kg. The stated cash cost of production was $16.54 / kg; obviously still higher than the ASP, but considerably lower than the $27 / kg from Q1 2014. If Molycorp is able to drive those costs down further, as they have so stated, to some level below the current ASP that produces a reasonable margin, then that business segment will be making money for the company.

    Same goes for Lynas - the company has recently indicated production levels that are in proximity to their break-even point. So long as they can produce with an ASP that is equivalent to the cost of production plus a reasonable margin, they will make money. In both cases, scaling production to what are reasonable targets, will get them there.

    The timeline and the capital structure required to get to these points are another matter; from the technical / operational point of view, however, I am optimistic that both of these companies can make it happen.
    Aug 29, 2014. 10:42 AM | 4 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    @optionsgirl: the VAT mentioned in my article refers only to products produced in China. It is charged to the purchaser of the raw materials, whether they are used internally or are directly exported. If the materials are used internally to make, for example, magnets or polishing powders, and those finished goods are then exported, the VAT paid by the end user on the raw materials is refunded back to them.

    My understanding is that because this rebate is available to all end users in China that export finished goods, whether or not they are domestic- or foreign-owned, then there is no issue because the approach is evenhanded. Such finished goods are not subject to export quotas.

    The issue of FOB vs. domestic pricing in the later paragraph that you quoted, concerns the price decks that are used by juniors, in determining the assumed future values of their products. The typical assumption has been that they will sell a mixed REO concentrate, without specifying to whom such material will be sold. Given the lack of excess capacity for separation outside of China, the implicit assumption is that maybe the Chinese will buy it.

    However, such purchases would have to compete with internally sourced materials, which are purchased internally at some discount to domestic, not FOB / export prices. So those juniors who are assuming that their material will be sold into China, should be using a domestic, not an FOB price deck, from which to then discount to establish the value of their concentrate.

    Of course that assumes that folks in China will want to buy such concentrate in the first place; some of the juniors are going to have a rude awakening in this regard, given the lack of interest in such materials.

    As for Lynas and Molycorp, their processing is done outside of China, so they have the advantage of needing to compete with the FOB prices, not the domestic prices, assuming their customers are based outside of China. In the case of Molycorp, which may be transferring a portion of its material to its magnetic-materials operations in China, different mechanisms may apply.
    Apr 5, 2014. 09:27 AM | 7 Likes Like |Link to Comment
  • REE/Strategic Minerals Concentrator, March 18, 2014 [View instapost]
    @motionstream: to what special interest are you referring? In case you didn't know, Jon is no longer with Byron Capital.
    Mar 30, 2014. 10:01 AM | 2 Likes Like |Link to Comment
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