how much can REE stocks run# Stock
s*r
1 楼
Fear that China will use rare earth elements as political weapon has spooked
the market and generate huge
run of REE stocks (e.g. MCP). The question is how long the trend will
continue. My answer is not for long.
The reason China dominates the REE market is not because China is the only
country that has REE, but because
China can produce them so cheap that anyone else who want to mine their own
REE would loose money. If
China really want to keep REE as a viable political weapon, they cannot
completely shut-off exports or drive
the price of REE too high. Otherwise the price of REE would rise so high
that miners in the US could make
profits. High price also cause companies to find replacement of REE. Both
these will dimmish the leverage
China has. For this reason, China will try to lever the price so that it is
still cheaper to buy Chinese REE. This will kill the US miners and the drive to find
replacements.
the market and generate huge
run of REE stocks (e.g. MCP). The question is how long the trend will
continue. My answer is not for long.
The reason China dominates the REE market is not because China is the only
country that has REE, but because
China can produce them so cheap that anyone else who want to mine their own
REE would loose money. If
China really want to keep REE as a viable political weapon, they cannot
completely shut-off exports or drive
the price of REE too high. Otherwise the price of REE would rise so high
that miners in the US could make
profits. High price also cause companies to find replacement of REE. Both
these will dimmish the leverage
China has. For this reason, China will try to lever the price so that it is
still cheaper to buy Chinese REE. This will kill the US miners and the drive to find
replacements.
