SOURCE: Five Star Equities
NEW YORK, NY--(Marketwire - Sep 11, 2012) - The world's Rare Earth Industry has long been dominated by China who controls roughly half of the world's reserves and 95 percent of the global supply. China's stranglehold of the rare earth market may finally be coming to an end as Lynas and Molycorp have both made major announcements in recent weeks regarding increased production. Five Star Equities examines the outlook for companies in the Rare Earth Industry and provides equity research on Lynas Corp. Ltd. (PINKSHEETS: LYSCF) and Molycorp, Inc. (NYSE: MCP).
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Australia based miner Lynas last week received a temporary operating license for their new rare earths facility in Malaysia and will begin production in October. The company estimates it will produce 22,000 metric tons of rare-earth materials once it reaches full capacity in late 2013. The flood of new production is likely to pressure rare earth prices.
"The entrance of Lynas and Molycorp into production is likely to lead to a global surplus for most light rare-earth elements and we believe it is likely prices will continue to weaken over the near term, with very limited engagement currently from buyers," said UBS analyst Ben Wilson.
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"Receiving this licence from the AELB is a significant milestone for Lynas," said Lynas Executive Chairman Nicholas Curtis. "The TOL provides additional validation of the safety of Lynas' operations in Malaysia and supports the previous assessment by the world's pre-eminent radiation safety authority, the International Atomic Energy Agency, that the LAMP is safe and fully compliant with international standards."
Molycorp is a leading rare earths and rare metals company, and combines a world-class rare earth resource at Mountain Pass, California, with advanced, high-purity rare earth and rare metal materials processing capabilities. The company recently announced the start-up of its new Project Phoenix heavy rare earth concentrate facilities.
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