Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Dudley Kingsnorth On Rare Earth Demand

Saw this article online, thought it might interest people.

TORONTO ( - Demand for rare-earth elements, used in a wide range of technologies from precision missiles to iPhones, will grow by about 33% from 2012 to 160 000 t in 2016, Industrial Minerals Company of Australia director Dudley Kingsnorth said on Thursday.

Demand for the group of 17 elements, which fell to 105 000 t last year, should recover in 2012, surpassing 120 000 t, he added.

China produces around 95% or global rare earths supplies, and has been cutting exports and production, which led to a rapid run-up in prices in 2010 and the beginning of 2011, before global economic uncertainty hit demand.

While demand is set for substantial growth by 2016, Kingsnorth also predicted supply outside of China would increase more than tenfold over that period from 6 000 t last year to 60 000 t/y, as projects such as Molycorp's Mountain Pass mine in the US and Lynas Corp's Australian Mount Weld project starts producing.

By the end of the decade, demand for rare earths will hit 240 000 t/y, with China accounting for 65% to 70% of global consumption.

Speaking to a crowd at the Toronto Technology Metals Summit via video link-up from Australia, Kingsnorth predicted that supplies could reach 190 000 t/y by 2016, implying a surplus of around 30 000 t/y, but said there was "the issue of balance".

On Wednesday, Technology Metals Research founding principal Jack Lifton said in an interview that rare earths prices would likely show further easing this year.

Kingsnorth said they would likely firm in the first half of 2012, showing some weakness in the latter part of the year once Molycorp and Lynas start producing.

Disclosure: I am long OTCPK:GWMGF.