Rare Earth Australian Company Lynas to Accelerate Production on back of Japanese Demand

Australian Company Lynas Corporation is going to accelerate the production from its Mt. Weld Mining Project in Australia in order to meet increased demand from Japanese companies.Lynas is building a 20,000 tons rare earth mine in Australia with processing to be done in Malaysia.The company had raised around $500 million with strong institutional backing to boost the supply of non-Chinese Rare Earth Production.The Rare Earth Mineral Frenzy has cooled a bit but the supply picture is still in a constrained mode with Chinese exports of REE falling by 77% in the month of October.Japan is the most exposed to the Chinese slowdown of REE minerals with a large processing industry and consumption sector.Japan has been frantically looking towards the surrounding seas,Vietnam and Kazakhstan as China has used its monopoly position for political ends.

While increased supply should help meet the growing demand for this Green Industry raw material,it should take another 3-4 years for the supply to kick in.Meanwhile Lynas,Molcorp,Avalon,Great Western Minerals and other REE companies should benefit.Sojitz Corporation which is a Big Japanese Trading Company on the lines of Sumitomo has signed the 10 year contract.Both Sojitz and Lynas stock prices were up on the news of the deal.

Sojitz, Lynas Shares Jump After Rare Earth Deal – Businessweek

Lynas is “in advanced stages of discussion to secure additional supply of rare earths products for the Japanese market by accelerating the expansion of the Lynas rare earths project,” the company said in the statement.

Sojitz climbed 9.1 percent to 168 yen at 1:47 p.m. in Tokyo, making it the best performer in the MSCI Asia Pacific Index. Sojitz will hold a press conference today, according to an announcement. Sydney-based Lynas, which said separately it was in talks to increase output and supply to Japan with an unspecified company, climbed 9 percent to A$1.51 after NHK reported that Sojitz agreed to pay Lynas $300 million to supply 8,500 metric tons of rare earth metals over 10 years.