the malaysian insider article, page-16

hartg,
Some of this has been mentioned before, but I'll try a different angle. consider Slide 35 of:
http://www.lynascorp.com/content/upload/files/Lynas_Corps_J_P_Morgan_Presentation_September_New_York__FINAL.pdf

You will note 42% of our production cost is chemical reagents- the chemicals needed in leaching and extraction(this is probably higher now since the cost announcement this year). An additional 20% is the energy needed in processing. Only 4% of processing is labor. So you are right that labor is not the main issue.

It may help you as a stock picker to see Lynas as both a mining stock and a specialty chemical stock in one. If you have traded specialty chemical stocks you know they are mostly dividend stocks that rise and fall largely on the pricing for their end products and the cost of their input costs.

Now the beauty of Lynas is that they are starting their company from the beginning, taking advantage of thier position on the globe. They are taking the best resource in the world, Mt. Weld and combing it with an ideal chemical processing location, the LAMP in Kuantan, Malaysia. And by doing it this way they are positioning themselves as a global company from the beginning. This efficiency will translate to the bottom line from day one.

Of course there is a shipping cost (just 9% of Lynas' total cost). That cost is very overestimated IMO. First, those costs are small and stable when compared to the chemical and reagent costs. Second shipping rare earth concentrate is not like shipping other mining materials. It is not bulk shipping so the volumes are much smaller than most people in mining are use to picturing.

So the bottom line is the Lynas business model is established technologies that produce synergies and efficiencies that take into account the details of its businesses cost structure before it is every producing. That is very impressive forward thinking.

But if you want to see it all in action I'm fine with that. I am in. I get paid now or later. Waiting effects your cost basis not mine. Good luck either way. But most of all, best wishes to Lynasheads.