Will the price of Rare earth rise like 2011 year?

Post time: 2014-07-22 14:56:04


     Since middle of June, the domestic price of light and heavy rare earth oxides are bottoming out, the main varieties of light rare earth oxide, praseodymium, neodymium oxide prices rised more than 10%, and the upward trend is accelerating; price of heavy rare earth dysprosium has risen from RMB 1255 / kg to RMB1475 / kg, up more than 17%, terbium oxide from RMB2550 / kg up to RMB2950 / kg, up more than 15%. We judged that the price of rare earth had been at the bottom in last full year, and this decline has narrowed in this year, but it continued to show a downward trend. In middle of May, the heavy rare earth prices start to return –up, and in the middle of June, light rare earth prices also recovery, we believe that light and heavy rare earth prices have rebounded after two years adjustment, It began to look for new price equilibrium.

    Since the round of price adjustment of rare earth from July, 2011 to May in this year has been more than two years, the main varieties of rare earth prices fell more than 80%.  Rare earth enterprises overseas keep loss for three consecutive quarters; we consider rare earth price always is lower than the cost line in the oversea enterprise is not sustainable. With midstream and downstream enterprises restocking, rare earth exports are picking up and gradual recovery of the industry, rare earth prices gradually rise.

     Overseas production release is limited, rare earth prices have continued to rebound phenomena, from Molycorp2013 in Q1 quarterly perspective, the Q1 quarterly real rare earth oxide production and sales is only 763 tons, according to the current production, we expect this year's total output in 5000 ton, lower than our expectations, and the third consecutive quarterly keep loss. Based on our overseas production of rare earth observation on operating costs, the current rare earth prices have been lower than the cost of overseas enterprises.  Currently, Molycorp's Mountain Pass of costs, the average cost of production in its REO at 40 U.S. dollars / kg, which has multiple consecutive quarterly losses. We consider that rare earth price is difficult to maintain long-term cost under the overseas rare earth line; rare earth prices rebound relationship is a true reflection of market supply and demand, so rising prices is sustainable.