Those comments are related to my macro view about Lynas. Lynas is a strategic asset to US and western allies to offset China’s dominance in rare earth industry. Not perfect as it has limited processing ability. No matter how bad the business is, it will always be supported by the western. Unfortunately the intense geopolitical game US imposes on China has now backfired, China has restricted its rare earth exports ( China has over 80% world market) and continues taking over rare earth sites around the world where it can. China will continue to control the rare earth markets until other countries are willing to do the dirty jobs China has been doing for decades. So Lynas will always be a price taker for some considerable time.
This competition also makes Lynas an inherently a strong takeover target for the riches. Remember Westfarmer from few years ago? Now Gina is interested, there are bound to be many others who are eager to pound when the time is right.
I don’t see any improvement in RE prices in the near future as western countries have walked back on EVs and green initiatives due to China’s dominance in those areas, and we are due for an economic downturn, Lynas is unique in the industry and will be ripe for takeover even the business has some obstacles to get through.
LYC Price at posting:
$7.02 Sentiment: None Disclosure: Not Held
(20min delay)