Eramet, JUWI Energies ink deal for solar and battery storage project in Senegal
The 20 MWp solar and 11 MWh battery project will provide clean energy to meet 20% of the mine’s energy needs.
In lunchtime trade on Friday Molycorp was changing hands for $19.93, down $1.14 or 5.4%, on bad news about global rare earth demand and as investors continue to digest the company’s results out last week.
On Friday customs data from China – producer of 95% of the world rare earths – showed a 70% year-on-year drop in export demand as the country’s contentious export quotas are only filled 26%.
China is also the world’s number one consumer of rare earths – used extensviely in green technology and the medical and defence industries – and lower domestic consumption have also contributed to a severe price slump.
Last week Molycorp – destined to become the number one producer of the 17 elements outside China – announced it is already halfway in reaching its ultimate production target of 40,000 tonnes per annum and at the same time increased reserves at its Mountain Pass mine 36%.
However, investors are selling off the stock because the average prices Molycorp received for rare earth oxides fell 20% to $95 a kilogram from $120 a kilogram in the final quarter of last year.
Molycorp shares hit a 2012 high of $34.71 on enthusiasm over a ground-breaking deal with Canada’s Neo Material Technologies announced in March that gave it access to advanced rare earth processing capabilities and a sales channel into China.
But that euphoria has now evaporated as REE prices and demand in China collapse and consumers in the automotive, high tech and green energy industries scramble to find alternatives.
Tuesday’s decline brings Molycorp’s losses since hitting a high of $77.54 on May 3 2011 to 74% and a market value of $1.9 billion.
Read more about why China’s export quotas and the WTO spat have become a joke >>
Read more about how rare earths have created a political fault line in the US >>
Read more about the implosion in rare earth oxide prices >>
