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Rare Earths

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bowman

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29 June 2007
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It seems to be all go in the rare earths space since the recent publicity of China's global near-monopoly of these minerals.

I can't say I've given this area much focus in the past apart from LYC and ARU.

A quick internet search uncovered this site for anyone interested.

http://www.australianrareearths.com/

And here's today's watchlist snapshot of the stocks listed on that website (the lower watchlist being companies with a JORC resource, according to that site).
 

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Thanks Bowman.

Placed them in a watchlist of my own now.
ALK
ARU
GGG (Which I have)
GXY
LYC
NAU

Are the most appealing technically (To me) with GGG GXY already well underway.
 
Cheers tech

I got a few NAV today - interesting three days of volume.

I also like the look of ALK as one that hasn't got away yet.

NRU is obviously thinly traded but I'll be watching anyway to see if we can get some more buying interest like today.
 
Have always been quietly confident about ARU, has been running hard as of late. with an undiscounted Revenue of about $9billion over 20years, assuming REO prices don't increase.

Which with the increase in demand is unlikely, ARU once in production will be seriously undervalued.

I have little knowledge about the remaining REO plans however i have been keen on ALK and GGG.

Please note ARU up another 24% today
 
AEE having the obligatory run today. (I'm holding a small parcel).

We can delete NRU from the list and chuck it back into a Uranium watchlist.

To quote one line from a reply email from the Company secretary of NRU:

"Fair to say, at this point in time we do not hold any Rare Earths prospects of any significance."
 
I wish there are exchange traded funds which are tailored for specific market sub-segments with focus on smaller companies. e.g.

Iron ores ex-BHP/RIO/FMG
Uranium ex-ERA/PDN
CMG
Rare Earth
Copper
Coal
REITs ex-WDC/SGP/LLC/MGR
Telecom ex-TLS/SGT

It will allow lazy people like myself to pick a market segment rather than winners within them.

I will pay a 2% management fee to gain some diversification, avoid single name risks, and for smaller investors, reduced brokerage.

A business idea perhaps?
 
There goes CMY, (I have a few of those as well) so there's not much left from that original watchlist that hasn't had a trot.

CVI and JRV I wouldn't touch with a ten foot pole and I haven't looked at ATR yet.

HAZ released an investor presentation on it's tungsten project today and there's not a boo about rare earths so I imagine this is not their priority atm.
 
why would you go past lyc when their finishing plant malaysia will be supplying existing orders in excess us$400 mil in around 18 mnths time.
 
Call me stupid, but I find 20% - 50% gains in one day quite satisfying, wherever and as often as I can get them.

Never get tired of it.
 
ORE is a lithium alternative to GXY.. I hold GXY

both moving up well
 
RDR is also a lithium play and has been moving a little of late.

I hold.


Geea.
 
china has cut its rare earth exports by 72%

as reported in bloomberg

how good or bad is this news for rare earth companies?
 
Well the exports have been restricted with the aim to 'help protect the environment' according to the article - which I don't believe for a second.

Considering that China has a monopoly of >90% of rare earth minerals used in the manufacture of technology such as mobile phones, if they cut down their supply that means supply may not reach demand and gives rise for these companies to increase the price of these rare earths under the guise of 'protecting the environment'.

China looks good for 'protecting the environment' and companies sell less of the material for a much bigger margin. Short term i think rare earth companies may suffer due to the decrease in sales (and investors will probably sell down these stocks in a knee-jerk reaction) but I anticipate high prices to follow and greater profitability for these companies in the long term.

If technology manufacturers stopped using these metals well then i'd be jumping ship.
 
Agentm said:
how good or bad is this news for rare earth companies?
Click to expand...

Rare earths, the new oil. Good to see your interest, may we see the same depth of research into the "new oil" as you gave to the other oil. I've been into LYC for years and now into NTU. Odd that I bought into NTU a few weeks before LYC bought in as well. I'm looking at trading between the two as soon as I can establish comparative values.

China is playing ducks and drakes here. Maybe it will help, maybe it will confuse the issue but either way I am looking forward to this being good for me. Hopefully as good as the AUT,ADI and EKA episode. It is the EKA profit that is now in LYC and NTU.
 

Yep I'm also sitting in both, been holding LYC and NTU these past couple of weeks, accumulating on the LYC dips. NTU is gathering some good support in the last few weeks
 
Is anybody here keeping an eye on ORM? They've had a run up from 5c to 27c which under normal circumstance I'd stay away from. However, with a market cap of about $20m fully diluted, ORM could be one of the only basement REE plays left with decent prospects for some short term upside.

  • Their cash position and options in the money means that they have enough to cover costs for another 2-3 quarters, so no danger of a capital raising until after the drill results are out.
  • The Top 20 own about 80% of the stock, and there have been several substantial shareholder notices recently from 2 Chinese mining and investment groups.
  • 2 directors have also been buying recently at near today's price (25 to 26.5c)
  • They have 3 REE projects which have reported some high grades of HREEs and are continually adding to their REE portfolio. They also have a gold JV with Newmont.
Todays they just received drilling permits and begin drilling next week.

From today's announcement:


Note - traders have been all over this so it's not one for the faint hearted who can't handle the intraday swings.
 
A somewhat backdoor play to ORM would be to buy MLM, IIRC they have a significant holding in ORM, as well as diversified holdings in other companies. MLM is also trading significantly below NTA, and has very large scandium holdings. I would buy in but lack of capital currently means I can only chase the companies I think have the shortest turn around time for a decent return, MLM seems to me to be a good long term play in minerals.

 
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