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LYC - Lynas Rare Earths

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Joe Blow said:
Why?



Why?

Can both of you please elaborate? Enquiring minds want to know why.

More content would be appreciated.
Click to expand...

Malaysian government article regarding protests.

Plus negative lead from Wall St means lynas is heading south. (most likely, obviously I am taking a risk!)
 
It is clear that LYC was constructing the plant in Malaysia before it has all the permits in place. What was the discussion/company announcements regarding that when they first chose Malaysia as their production base? Were there some assurance / hints from the gov't there to say it will most likely be granted the necessary approvals? Did the gov't change their mind? Or was there too much one-way wishful thinking on part of LYC?

Anyone knows the history well enough to comment?

In the interest of bringing forward production/revenue, such parallel activity is probably understandable. But the risk is of course they don't get some important piece of permit and they have no plan B or money left. How well were those risks communicated to the shareholders?
 


I do not know the history very well. but I would be very suprise that is only one-way wishful thinking LYC when they decided to spend so much money in a country. Saw protest thing, it looks to me more like manipulation and encouraging by someone as it is closing to production. my evil thought is probably good for local governement to negotiate with LYC
 
I'm guessing that if Lynas has invested so much in building the infrastructure and hiring personnel that they are quite confident of getting the permit.

Perhaps they are also banking on the fact that if the permit is denied, Malaysia may not be seen to be a safe place for FDI and that is something the Government probably doesn't want.


Information provided to shareholders is poor in general.
 
It's just a political game.
The protests are China backed, sponsored and fueled.
The protests only started once China was denied the right to purchase Lynas and maintain their monopoly on rare earths.
Just like the protests outside the Hong Kong Apple store that claimed to be protesting against conditions and pay in Chinese owned and operated factories that happened to make apple parts!! These China orchestrated protests occurred as an immediate counter response to USA footage showing fake apple stores in China!!!

Lynas did get the nod from Malasian MPs they couldn't have even bought the land without that.

Now the MPs are aware of the political risks because the Chinese are managing to propaganderise the notion to the locals, to some degree, that Lynas will generate nuclear waist and destroy the local community. If you look into the grievances behind the protests you will find they are simply headline grabbing unfounded rubbish.

The Malaisan MPs are well aware of what is going on and will allow the project to continue, however due to the politicizing of the issues they must look like they are playing hard ball with Lynas and demanding environmental plans etc etc before they can go ahead in order to appease the people who are being fed lies on a daily basis by Chinese sponsored apposition to the project.

The real risk for lynas that people should be focusing on is the reality of making the whole thing work as it is with any new mining venture, going from plan to reality is the hardest step - often with some pretty savage reality bites!

The last time China manipulated rare earth prices, about 8 months ago Lynas shares pretty much doubled!!
China's doing it again so if the global financial system is not destroyed over the weekend things should be pretty good for the short term LYC price action!! IMO
 
notting said:
The protests are China backed, sponsored and fueled.
The protests only started once China was denied the right to purchase Lynas and maintain their monopoly on rare earths.
Click to expand...

Do you have any evidence for this claim or you are just making it up as you go?


And evidence for this? The factories were Taiwanese businesses and there were a host of suicides amongst the workers. The protest were both against the factory and against Apple (for not caring enough). How does that constitute a counter response to fake Apple stores?
 
You need to think more deeply about it.
The suicides are all over the place in Chinese factories and have been for decades not just Apple!!!! for valid reasons, they are Chinese run brutal slave houses!! Workers are abused, raped by the masters etc ect. They are called foreigners even though they are Chinese because they don't have the specific in the club card etc The workers used to not get paid at all! They were kept like prisoners. Just fed and given a bed. It was better than starving on the streets!

The authorities choose to go to the media and make a global noise about it like that did with Apple or as they did with Honda earlier when the Chinese were making moves in Japanese sea waters as it suits them and make out it is the foreigners abusing Chinese. They will peddle it all over their state controlled local news in that light too, even though it's the Chinese authorities and their lack of any kind of care for workers who set the whole thing up!!
It doesn't happen in free countries because there are laws that are largely abided by against it.

If I told you China could organise at the drop of a hat 10,000 strong protest here in Australia by paying it's people here $300 each to participate and act brutally toward a pack of Ausies would you believe me? Would they get away with it? Would our media report it accurately? What do you think.
 
notting said:
You need to think more deeply about it.
Click to expand...

It's not about how deeply one thinks about it.

What if any evidence do you have? Ignore the Apple part, just answer your Lynas claim since we are on the LYC thread.

I don't doubt that China may be capable of doing it, but I also don't doubt the Martians could have done it too.

So do you have evidences? Or are you just putting forth some theories?
 
What I mean by think deeply about it is this -

For investment purposes, the point is you can see for yourself whether the claims against Lynas that fuel the protests are legitimate or just bazaar unfounded scare mongering driven by ?????? doesn't really matter once you see bazaar unfounded scare mongering!

That's enough to get the picture from an investment point of view.

As an aside:
One of the first things the Chinese will ask a 'free worlder' for who dares speak out about them is - 'Where is your evidence?,' then sue you when you cannot legally prove it because the Chinese control the evidence!!
There is no free speech, you can be imprisoned just for listening to subversive talk in China. They will shoot you if you try to escape even with no evidence they don't even want the general picture to get out.

If you provide some fragment of evidence, in the free world, (they will just silence you if you are in China),that you have managed to gather from someone who has put their life and family etc at risk to get it to you, the Chinese authorities, having been caught out, will then say, "Oh yes, we are investigating this matter," as if they had nothing to do with it and it was some independent free Chinese person or corrupt official or company doing something 'illegal'. Little will then come of it.
The person and their family providing evidence will vanish!!

Looking at the dynamics and the environment is a little easier than coming up with state controlled evidence.
Looking into the motives, capabilities, players and history paints a picture.

To repeat - For investment purposes, the point is you can see for yourself whether the claims against Lynas that fuel the protests are legitimate or just bazaar unfounded scare mongering by some highly motivated forces that have a vested interest in attempting to control rare earths.
 
Skc and Notting,

Very interesting debate! I think both of you make excellent points. While Notting's theory sounds plausible and makes sense, I agree that more evidence would be useful.

The way I see it, China's initial motives were not to have complete control of rare earths but to have a large chunk of a difficult to enter highly priced market. Of course, after rare earth prices have gone up so much, that plan may have changed. I guess this is one of those things we will never know for sure but if you are right notting, then LAMP will go ahead. SKC, what is your alternate theory? Just that the Malaysian's are legitimately concerned about Thorium contamination?
 

Instead of an essay you could have just said "No. There are no evidence and it's just a theory."

You have a view that Chinese are evil doers in the world and you fit theories all over this forum to suit that view. While you are entitle to your views and more than welcome to put forward theories, it would be nice to quantify them as such, and test them with some evidence every now and then.


Alternate theory? I wouldn't put Notting's theory as the mainstream...

There are probably simpler ways of explaining this. I don't know much about Malaysian politics, but I am guessing it is pretty much the same as anywhere else... someone not in power will pick on the decisions by someone in power, while both sides will back popular opinion where it suits them. I am also certain that the local residents should be concerned - whether it is scientifically grounded or not - as much as people here are concerned about coal seam gas in their backyards.

So concerned people looking at politicians for help, and those politicians are only too happy to help in order to make political gains (as long as they don't have LYC shares I guess). You really don't need a Chinese conspiracy theory to explain it. And a Chinese conspiracy theory certainly doesn't help with an investment decision - even if the Chinese are behind it does it make it more or less likely to succeed?

As I asked earlier, I am interested in knowing what steps LYC took to address the regulatory risks prior to construction, and if LYC had a plan B. It is difficult to predict the outcome of a regulatory issue, but knowing what they've done previously can help frame the probability of the outcomes, while knowing if they have a plan B can help with estimating a floor to the downside.
 
Governments (including developed countries) fund protests and entire revolutions all the time (not always publicly), so such a thing occurring would be nothing new.

This too seems consistent with Chinese desires to corner the RE market.
 
Whilst global market dynamics and the politics of government funded grey ops is a delightful topic to talk about I dont think it really adds much to the conversation with regards to lynas. Sure these things affect share price but that is true of most stocks.
 
Yes we're getting two different stories, very tiresome, and testing investors patience. The US ADS slumped overnight, so it's clear what US investors think.
 
Logique, Hang in there mate!

LYC has been putting in a bottom over the last 6 weeks don't throw the towl in at the bottom.

One thing about LYC is that it trends hard in both direction i'd say risks are to the upside here.
 
When the rubber hits the road the true quality of the management comes out.
The first skid is a delay, though slight, is enough to inspire caution.
You don't want it to be backed up by another and another.
That will generate a decent leg down.
So far management is scoring below par!
If it get's going on the adjusted time frame and they get the approvals, the upside is far greater from here.
 

below par? Yeah, just like Goldfinger in that old 007 movie. I bet he was "below par" when he missed that last crucial put..

Talking about up-or downside potential: the company is still valued at 2.000.000.000 AUD = two billion while having confirmed the delay of production to the first half of 2012 with falling basket prices and escalating protests.

So, what is the reason for the delay? Construction flaws? Maybe. Missing license? Yes. But the main problem has a political cause IMVHO. If so, the company should higher the acceptance among the population in Malaysia. Has this happened?

Regards
Julia
 
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