The problem REE will face is that there are many mineral sands companies in Australia which already produce and sell monazite concentrate to overseas buyers. ILU will likely snap up this local supply first (and these firms might want to sell locally instead of overseas) before they choose to partner with a carbonatite hard rock deposit such as REE. Not to say its not possible but we as REE will need to compete against other low hanging fruit which is already producing and selling product on a regular basis compared to a rare earth deposit without any metallurgy work been completed/announced and still have lots of development work ahead.
This is an overall good announcement for the global REE industry and Australia in particular. However, the elephant in the room nobody will mention is that China may consider flooding the global market with REO oversupply to decrease spot prices and make any new REO plant uneconomic (forcing shutdowns or project financing delays). Sure the existing Chinese smelters will be upset but it would ensure that the national rare earth monopolistic positioning maintains. Furthermore, the State Council has been making press releases that its REO basket price is too high of late. That being said, one new plant will not make much of a global impact. another plant is the LYC in Texas, USA, so their could be incentive for China to act and protect its own positioning, just as any other country would if the roles were reversed.
REE should be pushing CREC to exercise the Laos smelter option agreement and get that plant up and running or at least bring in cash flow for both companies through importing monazite con from Americas, Africa or Aus
REE Price at posting:
11.0¢ Sentiment: Hold Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)