LYC - Lynas Rare Earths

[pops11]

Alkane is producing but in a smaller capicity right now but they have sent samples off late last year to Japan and other Europe Countries good read threw there ANN's

LYC is the one for me tho and this year they will do alot better, money was the key issue.

 

[Solitus]

Announcement pre-open this morning - Lynas have a fixed-price contract now with Abesque to complete design and construction of the processing plant at Mount Weld.

They expect site mobilisaiton to be in April, and first Ore in December. Looks like it'll be a good year for them - especially if there's more noise in the media about Chinese export restrictions on rare-earths.

I bought in earlier this week - the chart said to me that it was coming out of a period of being heavily oversold and looking ready to bounce off the 38% fib retracement @48c with some movement next week. Supported by Stochastic and MACD cross, so I'm now holding a parcel at an average of 49c.

I'm probably in this for the long-haul, with the global pressures on these metals and very limited production outside the restricted Chinese market. Of course, I'm not a financial analyst or advisor, I'm just a regular spare-time spare-cash investor, so don't act on what I say, be responsible for your own research.

Lynas Corporation Limited (“Lynas”) (ASX code: LYC) today announced that it has issued a letter of award to Abesque Engineering Ltd (“Abesque”) for a lump sum contract to complete engineering design and construction of the Mount Weld Concentration Plant.
The lump sum contract will replace the existing separate engineering and construction works contracts with Abesque for the Mount Weld Concentration Plant. The existing contracts were based on schedules of rates, and so the move to a lump sum contract should reduce the risk of variations from budgeted costs.
The lump sum fixed price of the new contract will be A$36,232,733 (excluding GST). The figure of A$36,232,733 is within the Lynas budget and it represents the bulk of the Mount Weld Concentration Plant capital costs amount of approximately A$45.6 million referred to in the March 2010 Lynas Investor Presentation. The majority of the remaining amount is also committed under existing contracts.
The key target dates for the Mount Weld Concentration Plant are as follows:
(a)
Mobilization to site – April 2010;
(b)
First Ore Feed – December 2010.

 

[Miner]

I hope Lynas holders and prospective holders will be happy with the report attached.
The EPCM cost has now calculated slightly higher. It should not be of concern however due to the fact the level of accuracy is much better now and original estimate might have taken lot of assumptions and factoring as typical to an estimate before engaging UGL as the EPCM contractor.

The gold lining is the company has the fund and no debt.

Good luck to you all

PS : I hold

 

[vincent191]

High time they get a bloody move on. The project had been on hold for nearly two years. I reckon once they become a producer the market will re-rate LYC. I can't wait forever, this stock had been underperforming lately. Hurry up guys before the next GFC comes along.

 

[TheAbyss]

Bit of movement in Lynas again lately (Up more than 30% since 6th June).

Press report say it is due to broker coverage commencing however didnt mention which one. Anyone know who is covering them?

Best of the rare earth companies on our exchange.

Press article at the below link is interesting.

http://au.news.yahoo.com/thewest/bu...le-for-rare-earth-deposits-begins-to-heat-up/

 

[Ding]

Lynas going well in the last couple of weeks. Anybody know why the recient upsurge of the share price? I wish i had bought more of them when they were down under 50c.

 

[pixel]

Lynas going well in the last couple of weeks. Anybody know why the recient upsurge of the share price? I wish i had bought more of them when they were down under 50c.

Try this article for an explanation:
Chinese Rare Earths Export Quota Significantly Reduced
Basing my trades and investments mainly on Technical Analysis, I didn't buy too many sub-50c either, although I traded a few small positions in June. But when the break level outside the falling channel (draw a trendline across the tops in October 2009 and January 2010) was tested again on July 1st, that changed 53c from resistance to support. That has been my signal to start accumulating a holding in my Superfund.

 

[nioka]

My stock of the day for discussion. I'll start by saying that there has been a steady increase in the basket price for rareearths as it affects Lynas. The margin over projected costs continues to increase daily and to a certain degree that fact is reflected in the SP. Remember that construction is proceeding as planned as far as we know and the day when sales will be made is not that far off. Lynas is well ahead of any competition. The attached article is interesting and worth taking into consideration.

"Are Rare Earth Price Increases Inevitable?

by stuart on July 20, 2010

It would seem everyone is taking an interest in rare earth metals these days. Not so long ago a casual observer could have been forgiven for thinking they were called rare earths because it was rare for anyone to take the slightest interest in them. Now there are conferences and blog sites and lobby groups all either warning of imminent shortages or crying foul at Chinese trade practices limiting supplies. It is true to say demand has risen dramatically over the last decade as new rare earth dependent technologies have become commonplace. At the same time, supplies have been limited by the Chinese authorities worried as reserves have become gradually depleted and anxious that rare earth metals produced in China should go to develop high technology industries within China rather than overseas.

Now banks and investors outside of the industries immediately involved are becoming interested in the sector as a recent Reuters article reports. Rob Edwards, managing director responsible for steel, metals and mining research at the Russian Renaissance Capital bank, told Reuters in an interview. It reminds me of a small version of the platinum group metals (PGMs) industry, where PGMs were a pretty mundane metal but then the world pushed very heavily for widespread use of catalytic converters. The banks interest is plain to see therefore, they are seeing price rises on the way.

The reason western world production of rare earth metals dwindled and the Chinese came to dominate the market was because western producers could not compete with the low prices widespread availability of Chinese material created. The Chinese cost of production was way below western mines and their plentiful supply left no place for western mines. Investors interest today is therefore a realization that if demand is increasing by 15-20% per year as Reuters suggests and supply is constrained by the Chinese desire to husband their limited resources, western suppliers will only become viable with higher prices. Projects that look marginal today therefore hold the potential to be very profitable a few years down the line, as prices have to increase. Strangely consumers are not voicing widespread concern about this; their principal issue has been one of security of supply rather than price. Maybe because for most applications the rare earth metal represents a small (although admittedly irreplaceable) portion of the overall cost. But surely if supply is being constrained and demand is continuing to rise there is only one direction prices will go, indeed has to go if funding is going to be raised to bring these projects on stream. Unfortunately this combination of constrained supply, rising demand and relative indifference to price rises will inevitably result in price rises as consumers out bid each other for supplies. A Rare Earths ETF anyone?

Stuart Burns


Source: http://agmetalminer.com/2010/07/20/are-rare-earth-price-increases-inevitable/"

Lynas was let down with funding at the start of the GFC and had to withstand a majority takeover by Chinese government interests. Wayne Swan did stand firm and refused the bid proceeding. Lynas then raised all the funds needed to proceed to production from shareholders. This did dilute the stock but that will be to the advantage of shareholders in the long run. Especially for those holders that subscribed and maintained the faith.

DYOR.

 

[tonudiki]

nioka

Thank you for the article by Stuart Burns.

I'm pretty new to REO and only recently bought into Lynas in the mid-fifties cps because I liked the Lynas profile and it looked an excellent long term investment. It looks even better now that the Chinese are imposing ever stricter export quotas!

Re pricing of the Lynas "basket" of REO's, I note on their website a current value of $18.44/kg. compared to a value of $13.13/kg at Q1 2010. This latter figure ties in reasonably closely to the Patersons report on Lynas of the 8th. March, which used an average of $13-77/kg. to calculate their 12 months target for Lynas of $1-00 per share.

Patersons also estimated for the "sensitivities" of their target, that a 10% rise in the REO basket price would increase their target for Lynas by 19 cps. So, presumably, with the Lynas basket at $18.44/kg, the Patersons target would now be ~$1.64 per share?

(n.b. As far as I can tell, the FX rates between the A$ and US$ are pretty similar now to those at the time of the report , so no need to take FX sensitivities into the revised target.)

Even after the recent movements upwards in the Lynas share price, it looks as if the current REO prices do provide headroom for the SP to increase further.......

 

[nioka]

Interesting article from the web. This news should be worth a cent or two to Lynas. The rare earth news keeps getting better and better for Lynas.


2010-07-22 21:55:51 CRIENGLISH.com Web Editor: Jiang Aitao

The Chinese government is busy preparing for the official issuance of a standard on industrial pollutant discharge of the country's rare earth industry, which is expected to speed up merging and restructuring among enterprises in the sector, the Economic Information Daily reports.

The Ministry of Environmental Protection and the Ministry of Industry and Information Technology are working on the new standard's promulgation in the near future, the newspaper reported Thursday, quoting authoritative sources.

If implemented strictly, the new industry standard will help to a great extent address overcapacity and deregulated exploitation that have caused the country's rare earth export prices to drop even as the international demand is rising, the paper says.

Annual demand for the mineral resource jumped from 40,000 tons to 120,000 tons in the past decade, while the country's average selling price of the commodity is currently only around one sixth of its 1990 level, the report says.

The new standard especially targets rare earth smelting and separation enterprises, with criteria covering discharge of waster water, residue, gas, as well as energy conservation.

About one third of the country's small scale rare earth enterprises will be forced out of the sector under the new standard's stringent environment requirements, according to preliminary estimates by industry insiders quoted in the report.

That's not to mention the market access standards for rare earth Industry drafted by the Ministry of Industry and Information Technology, which will further drive the industry to consolidate.

The country now has more than 1,000 enterprises engaged in the sector, spreading out in a dozen provinces or municipalities, with the Inner Mongolia Autonomous Region boasting 460 enterprises alone. However, only about ten of the enterprises run annual capacity from 2,000 tons to 5,000 tons, and only three of them running above 5,000 tons, the paper says.

The ensuing industry consolidation will inevitably drive down the country's rare earth output in the initial stage, besides adding operation costs to enterprises, which will in turn help to rectify the low export price, the paper said, citing Zhang Wen'an, with the Chinese Society of Rare Earths.

Source: http://english.cri.cn/6909/2010/07/22/189s584501.htm

 

[BraceFace]

Interesting article from the web. This news should be worth a cent or two to Lynas. The rare earth news keeps getting better and better for Lynas.

Ditto Alkane(ALK). A recent spike in their SP seems to confirm this.
See my posts over on that thread.

 

[nioka]

China Rare Earth Summit,Beiling 2nd AUG 2010


The forum will focus on the impact of China rare earth industry policy on rare earth related industry, overview of the world rare earth resources, the relation between new energy industry and the rare earth industry, the status and the trends of rare earth new materials, the influence of rare earth industry on the environment, etc. Leaders from the relevant government, entrepreneurs of rare earth production, application, trading, and information, well-known experts and scholars will be invited to give wonderful speeches in the summit.

 

[vincent191]

LYC should commence production around this time next year - 3rd quarter 2011. This is only phase 1.

To reach full production (phase 2) they will need further funding. If all goes to plan and phase 1 is successful funding for phase 2 should not be a problem.

Funding for phase 1 was a terrible experience and at one stage looked like it was not going to happen. I think the sp will not fully reflect the potential of LYC until production starts and most of the unknowns become reality. I can wait another 12 months it is not that long.

 

[nioka]

From the Lynas released company information,

"Company Strategy
LYC have a strategy of creating a reliable, fully integrated source of supply from mine through to the customer, and aim to become the benchmark for security of supply and environmental standards in the global Rare Earths industry. LYC focus upon implementation of its Rare Earths Direct (RED) concept providing an integrated Rare Earths (RE) business based around its Mt Weld deposit in WA. The Company places high importance on marketing its RED brand as a sign of guaranteed quality. LYC aim at becoming a significant rare earths producer, able to offer customers long term fixed or framed supply contracts. The first part of the RED concept envisages mining and concentration of Mt Weld RE ore and cracking of concentrate to produce mixed RE products. The second part of the concept is the separation of the mixed REs to produce individual Rare Earths Oxides (REO) and value added products in Malaysia. Initial production is expected at a rate of 10,500t REO. The result of this enables LYC to target 3 main applications; improving energy efficiency through lower consumption, environmental protection through emission control and developing smaller and more powerful forms of digital technology."

The SP continues the upward trend. There is good volume changing hands. It looks as though the problems of the past are now in the past. It has been a long journey and that journey still has a way to go yet but I am happy with the progress so far.

 

[nioka]

Lynas has set another milestone. It has closed in the 80s for the first time in two years. This is despite all the financial problems caused by the GFC and considerable dilution of the shares. Those that have held on and took advantage of the SPP are now being rewarded with, in my opinion plenty more rewards ahead.

 

[tonudiki]

nioka

Thank you for the article by Stuart Burns.

I'm pretty new to REO and only recently bought into Lynas in the mid-fifties cps because I liked the Lynas profile and it looked an excellent long term investment. It looks even better now that the Chinese are imposing ever stricter export quotas!

Re pricing of the Lynas "basket" of REO's, I note on their website a current value of $18.44/kg. compared to a value of $13.13/kg at Q1 2010. This latter figure ties in reasonably closely to the Patersons report on Lynas of the 8th. March, which used an average of $13-77/kg. to calculate their 12 months target for Lynas of $1-00 per share.

Patersons also estimated for the "sensitivities" of their target, that a 10% rise in the REO basket price would increase their target for Lynas by 19 cps. So, presumably, with the Lynas basket at $18.44/kg, the Patersons target would now be ~$1.64 per share?

(n.b. As far as I can tell, the FX rates between the A$ and US$ are pretty similar now to those at the time of the report , so no need to take FX sensitivities into the revised target.)

Even after the recent movements upwards in the Lynas share price, it looks as if the current REO prices do provide headroom for the SP to increase further.......

Just checked the latest "basket" price on the Lynas site and it's now at $24-11/kg. Using the base basket price of $13-77 per the Patersons report and their suggested 19cps uplift for every 10% above their base, I now calculate that Patersons target would be around $2-42 per share!!

 

[nioka]

A Report From The Rare Earths Conference In Beijing
by Jack Lifton on August 4, 2010

I am in Beijing, where I am attending and have spoken at the 2010 China Rare Earth Summit, part of the 6th International Conference on Rare Earth Development and Application, run by the Chinese Society of Rare Earths. I was honored to be one of only three American guest speakers. The other two were Americas most well known academic experts on rare earths, Professor Karl Gschneidner of the Ames Laboratory at Iowa State University and Professor William J. Evans of the University of California Irvine.

The conference has 300 attendees who are a comprehensive group, representing the academic, business, and governmental sectors of the Chinese rare earth research (academic and business), development, mining, refining, and end use manufacturing industries.

I was asked to speak about The American Perspective of the Rare Earth Supply Issue. My presentation and commentary will be posted shortly here on the Technology Metals Research web site for review.

Although most of the nearly 100 speakers in the 6 technical tracks, and most of the 222 papers listed on the program were highly technical, interspersed among them were some that were purely descriptive of mines, processes, and important sectors dependent on the rare earth metals such as permanent magnets, batteries, phosphors, wind energy generation, and other clean-tech/green-tech applications.

My colleagues Dudley Kingsnorth of IMCOA and Judith Chegwidden of Roskill Information Services, were also both invited guest speakers and Ms. Chegwidden was the moderator of the introductory session at which I spoke. Their respective presentations might be available online in the near future.

I am here in China to find out what the Chinese rare earth industry is doing and where it is going. I have a scientific background, and was once a researcher myself. I also worked with rare earths in product development for phosphors and batteries, so I was interested in and able to understand most, if not all, of many of the technical papers I heard. THe biggest surprises though, came from the survey papers on clean-tech/green-tech applications of the rare earths.

It is obvious from the vantage of the rare earths sector in China, that China is simply racing ahead of the rest of the world in volume production, as well as development of state-of-the-art clean tech and green tech products.

For example, it was pointed out that China built and installed 13 gigawatts of wind turbine electricity generating capacity last year, using rare earth permanent magnets for efficiency and low maintenance. The astounding prediction was made that by 2020, China will install 330 gigawatts more wind power capacity, with each 1.5 megawatt generator require one metric ton of neodymium-iron-boron magnet alloys, which, if they contains 34 weight % neodymium, would mean that the Chinese wind power industry would need a further 70,000 t of neodymium, approximately 3 1/2 times the 2008 production of that metal all as new added material between now and 2018-19.

I plan to write much more on this topic during the next few weeks, but I believe that the trend is clear. China will be the driver for, and the home of, the most demand in the world for the rare earth metals from now on.

There wasnt much talk about Molycorp in China, other than to hope that if it gets into production, Chinese customers will have an opportunity to buy its products. The only non-Chinese rare earth mining venture present was Great Western Minerals Group. Its chairman gave a talk on his mine to market strategy, and he told me he was there both because he was invited, and in order to continue negotiations for a strategic alliance with a Chinese refiner, on an African project the goal of which is to supply Great Westerns UK alloy plant, Less Common Metals, with feedstock metals for its operations from GWs South African venture at Steenkampskraal.

Japanese companies and academics were well represented and there were even French and Russian miners and refiners. I was disappointed that there were so few Americans, and as for the American media I saw only public radios Marketplace (who interviewed me) and the New York Times Asia correspondent.

If the rare earth supply issue is so important to Americas security, why then do so few Americans and almost no American media come to the worlds premier rare earth informational event? It is most likely because China is the center of the world rare earth industry, in all of its aspects.

The Chinese and Japanese magnet industries both need heavy rare earths. They may even need light, imported, non-Chinese, rare earths sometime before 2015, but I think it is clear that after 2015 they will both need heavy rare earths from outside of China. Japan may actually need both types of rare earths from the outside by 2015, if Chinese demand should exceed or meet its domestic supply capability by then, which is probable, so that China no longer is willing to export rare earths.

If all roads lead to Rome then certainly the home of all metals is now China.

 

[Huitzii]

Lynas made 39.45% profit last month and doesn't look like slowing down ATM.
As long as the trend stays as a trend im happy to hold, Lynas is in a very sound global position at this point in time with the Chinese restricting exports.

(From the Lynas website)
"Engineering and construction of the Lynas Advanced Materials Plant (LAMP) in Malaysia remains on time and within budget as at 30 June 2010; with the first feed to kiln at the LAMP on target for the third quarter of 2011."

Here is my analysis chart that shows the current trend, until the trend bends im in and topping up regularly.

Please don't act on any of my posts or on my chart analysis as it is only my opinion and may vary from person to person.
DYOR

 

[vincent191]

Hehehehe....breakout at long last. Good volumne and all realistic sellers have been taken out promptly. All RE market indications and announcements are positive. Anyone care to speculate what the sp will reach by end of this year?

My own speculation based on a suggestion in the telephone conference hosted by LYC, the sp will go higher by end of the year either by a share reduction scheme or by market forces to attract the big time investors like Superfunds. I hope both.

The suggestion was to follow the REITs and consolidate the share register which currently have around 1.4 billion shares on issue. A consolidation will get the sp up to get around the big funds preference to only invest in shares with a value >$1. LYC's comment was he will think about it and will do that if necessary.

Maybe this is not a bad suggestion.

 

[nioka]

Hehehehe....breakout at long last. Good volumne and all realistic sellers have been taken out promptly. All RE market indications and announcements are positive. Anyone care to speculate what the sp will reach by end of this year?.

I see little doubt that the SP will make a gradual climb as we get nearer to production and will peak as announcements are made that the plant is in production and operating successfully. I suggest that there may be some ups and downs on a daily or weekly basis depending on general news, the value of rare earths according to the LYC basket price and the worly supply and demand situation. Considering the timing of the program I think that LYC is priced according to value at this stage, good value with room for some increase but not real cheap.