Rare Earth Investing News is reporting that Q4 will bring more of the same bleak outlook for Rare Earth Materials.
http://rareearthinvestingnews.com/4840/rare-earth-q4-outlook/?utm_source=Resource+Investing+News&utm_campaign=c0bbf04697-RSS_EMAIL_CAMPAIGN&utm_medium=email
The news is once again sky high prices and tight supply outside China. It comes down to when companies outside China begin producing significant supplies of Rare Earth elements the prognosis remains the same. Production in China for 2011, has been capped at 93,800 Tonnes with exports limited to 30,184 Tonnes, slightly less that 2010.
Outside China, Australia’s Lynas Corporation has opened their Mount Weld mine and their initial target is 11,000 Tonnes of production but won’t effect the market until 2012 with their material being shipped to their Malaysian plant which has not been licensed as yet.
U.S. company Molycorp is currently the only company outside China producing Rare Earth Materials. Their Q1 production is 815 Tonnes per month which they expect to increase by Q4 to 1000 to 1300 Tonnes per month.
It is interesting to note that as reported on this site yesterday that China is shutting down 3 Rare Earth mines by January 1, 2012. These mine closings are expected to impact Chinese exports by 15,000 Tonnes per year and may drive prices higher than current levels.
In addition it has been reported that the European Union is stockpiling rare earth materials in an effort to reduce their dependence on China. There also has been calls for the U. S. to stockpile rare earth materials as reported on this site on August 31, 2011.
Eastern Ganzhou city has ordered three mines to cease production by the end of the year. This notice closed three of eight mines located in Ganzhou, Jiangxi Province.
http://china.org.cn/business/2011-09/05/content_23359179.htm
It is also reported, but not confirmed that closing these mines caused Hitachi’s stock to drop by 12%. Ganzhou, Jiangxi Province is reported to produce 40% of China’s ionic rare earths while the country produced 90% of the worlds supply of rare earth metals. The report states that rare earth production in these counties had fallen to $1.56 million per year. There was no indication as to what sales per year were expected from the mines. It is unknown when mining will resume.
The Toyota Prius requires 2 ob of Neodymium and 20 to 30 lb of Lanthanum for each automobile.
http://www.raremetalblog.com/2011/09/prius-for-china-market-opportunity-combined-with-ree-needs.html
Now due to the problem of obtaining Rare Earth materials Toyota has planned to expand to build manufacturing of some components in China.
In addition, Toyota wants to increase sales of their Prius model in China and has determined that it makes sense to manufacture some components there. Therefore they want to make Batteries and motors for the hybrid in China to aid in getting official approval for their auto sales. Previously the motors and batteries for the Prius were manufactured only in Japan. This is just another indication of the power that China is showing in both rare earth materials and manufacturing. It points out once again that the U.S. is now at a disadvantage in manufacturing and has a strategic problem with magnets.