skyfall, page-24

Because the FOB prices simply hasn't been adjusted for ages. Lynas has been working with that absurd spread, and they still do. Look at their website:

http://www.lynascorp.com/Pages/what-are-their-prices.aspx

They publish a price for Q1/2013: 1600.00
The china domestic price for the same period is 838.37

Now you go to metal pages and get a bit closer to reality:

http://www.metal-pages.com/metals/europium/metal-prices-news-information/

In real life there is a inofficial market with prices well below $ 500 (I would guess that the discount of higher priced REO is higher too).

But this is not the end of discounts you have to calculate. We are talking about Europium oxide, an element Lynas is not able to produce at the LAMP. The costs for external seperation must me taken in account as well.

You have every reason to distrust the FOB prices. The example shows why the expectations of future revenues and profits at current price levels are way too high.