China Looks to Stimulate Rare Earth Demand -- Molycorp and Great Western Minerals Look to Benefit
Last Update: 3/6/2012 8:20:48 AM
NEW YORK, NY, Mar 06, 2012 (MARKETWIRE via COMTEX) -- Rare Earth stocks have handily outperformed the market this year. The Market Vectors Rare Earth/Strategic Metals ETF (REMX) is up more than 15 percent year to date -- easily exceeding the 6.2 percent jump in the Dow Jones Industrial Average. North American rare earth stocks took a slight hit last week, however, as reports surfaced that China may boost exports to bring prices back down. The Paragon Report examines investing opportunities in the Rare Earth Industry and provides equity research on Molycorp, Inc. (MCP) and Great Western Minerals Group Ltd. (GWG) (pinksheets:GWMGF). Access to the full company reports can be found at:
www.paragonreport.com/MCP
www.paragonreport.com/GWG
Last week Bloomberg reported that China may almost double exports this year and meet quotas set by the government as lower prices stimulate demand. A late 2011 Ministry of Commerce statement said that Chinese exports were 49 percent of the government-allotted quota in the first 11 months of last year because the slowing global economy hurt demand.
"Export quotas may be met this year as overseas demand recovers," Wang Caifeng, a former official overseeing the rare earth industry with the Ministry of Industry and Information Technology, said in an interview in Beijing. "High prices last year had deterred purchases and led to inventories depletion. Smuggling also hampered exports through illegal channels."
The Paragon Report provides investors with an excellent first step in their due diligence by providing daily trading ideas, and consolidating the public information available on them. For more investment research on the rare earth industry register with us free at www.paragonreport.com and get exclusive access to our numerous stock reports and industry newsletters.
China's decision last year to cut exports boosted prices and sparked concern among overseas users about access to supplies. Now, China is encouraging its companies to develop rare earth mines abroad to help ease pressure on domestic producers.
According to Wang Caifeng, China has the technical expertise and human resources required by overseas company in mine development and processing.
