[ Jock is a professional trader and a SpikeTrade Member – Alex ]
Last night PBS Newshour ran ITN’s excellent intro to rare earths. Nobody partying in Copenhagen seems to realize that “green technologies” greatly stimulate environmentally-ugly production of rare earths in China. Prius’es and wind turbines use huge amounts of rare earths.
Also, Molycorp’s CEO (Goldman-Sachs-led group which bought Chevron’s Mountain Pass rare earth mine- the US’s ONLY past producing mine) “talks his book” about the importance of getting non-Chinese sources producing.
China has 95% of the world market (having no internal “environmentalists” to contend with) and regularly cuts price to forestall competing exploration and production.
http://www.pbs.org/newshour/bb/asia/july-dec09/chi…
Jock
PS: A couple of years ago, I was lucky to get to know a sharp resource guy who has spent 4 years ONLY studying rare earths. He is now one of the world’s leading experts, having traveled to China (and Mongolia) many times, and attended conferences all over the world on the subject.
He says he has yet to crack the code on rare earths as an investment. There was good speculation a couple of months ago, but the problem with the area is that most don’t know the true mix of light and heavy RE’s in a given deposit. (there are 16 RE’s) AND, the demand for each particular element is a function of where (fast-moving) technology is heading. Demand for a given element shoots up, then dies when a new technology replaces an old one.
Then there is the tendency of the Chinese to cut prices whenever a competitor looks likely to develop a competing deposit or begin processing in competition with them. I’m told the lithium exploration plays are a scam.
In Canada, the better “juniors” are CA:AVL, CA:GWG and CA:QUC on bigcharts.com – but the game, for the present, is merely speculation, as you can see from the runup a couple of months ago. There’s AU: LYC in Australia too. LYC is the ONLY one with enough volume to trade, but is only economical to buy through Interactive Brokers.
Molycorp, referenced above, is still private. Their IPO will be a heavily promoted affair.