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Rare earths miner Molycorp on Thursday swung into profit in the second quarter as it ramped up production at Mountain Pass, California, once the world’s largest supplier of the sought-after elements used in anything from iPods to stealth helicopters.
Net income came to $48.8 million compared with a loss of $23.3 million a year ago. Revenue came in just shy of $100 million, compared with only $1.9 million a year ago.
Commenting on the results the company said global demand for rare-earth elements remains “very high” and supply outside China, which controls more than 95% of world output, is tight.
The Australian reports Molycorp’s facility sold 829 tonnes of rare-earth oxide products, up 19 per cent sequentially and more than triple last year’s level. Average selling prices totalled $US72.80 per kilogram for the quarter, up from $US37.73 in the first quarter and $US7.16 last year.
MSNBC reports the company said the $781 million expansion project at Mountain Pass was “on time and on budget.” The facility is planned to achieve a capacity production rate of 19,050 metric tons of rare earth oxides by the end of 2012 and 40,000 metric tons at the end of 2013.
MINING.com reported in July when news broke that China was raising REE export quotas for the second half of the year, ostensibly in reaction to a WTO ruling, it was greeted with some surprise and a measure of relief by the makers of anything from iPods to lasers to stealth helicopters. But as the implications of the announcement on future pricing begin to sink in some analysts began to point out that rather than easing the pressure on manufacturers who need rare earths, China’s move was aimed at cutting off at the knees development of mining projects outside its borders.
