PDA

View Full Version : I heart rare earths!


Sparty
05-04-2011, 12:46 PM
In an article published in today's seeking alpha Brian Kelly starts his article Rare Earth Prices Still Rising (http://seekingalpha.com/article/267396-rare-earth-prices-still-rising-molycorp-is-a-buy?source=email_partial_daily_dispatch) with the somewhat interesting line: "I heart rare earths!"

Sounds like something out of a teen flick... but what he goes on to say about the Rare Earths is a bit more sophisticated....

"For the last six months the rare earth sector has been shunned by "traditional" investment firms. Perhaps it is the volatility or perhaps is it simply a matter of internal resources (i.e. not enough analysts). Regardless of the reason, the lack of attention provided a great opportunity to get ahead of the crowd ... we did and it worked nicely. Now that more analysts are covering the sector does that mean the opportunity is gone? Hardly.

Rare earths are more integral to global economy than both silver and gold. This week Dahlman Rose hosts a rare earth symposium which is sure to produce positive news flow. Moreover, understanding the critical nature of these metals will likely generate institutional investor enthusiasm. Since the investable universe is small this should produce the coveted elephant through the door scenario.


Lanthanum Prices Are Up 259% Since February


Cerium Oxide is Up 350% Since February


And Neodymium is up 161% Ends


Lynas Corp provides a weekly update of REO pricing here (http://www.lynascorp.com/page.asp?category_id=1&page_id=25)

Now with price rises like that we should see our near term Rare Earth producers start to soar. Lynas Corp (http://www.australian-shares.com/mining/LYC) is the sector's front runner followed closely by MCP and Alkane (http://www.australian-shares.com/mining/ALK) Resources.... In fact Australian Rare Earth (http://www.australianrareearths.com/rare-earth-stocks.html) plays are going to be very hotly pursued as they are both massive and further along the path to production than most.....


While the global elephant Greenland Energy and Minerals ASX: GGG (http://www.australian-shares.com/mining/GGG) is a bit behind in the production stakes once it comes on stream it will change the face of REE investing.