lyc's competitive strengths and weakness, page-3

Here we go with the Lynas is LREE talk again.....
So many miss the point on the current situation I am amazed at times. Current ROW supply is so low every element has a market. State of the art LAMP production of Ce, La and Sm sold under contracts will do just fine. And while the initial CLD has a light bias there is heavy rare earths they will be in high demand. Will Lynas satisfy the HREE ROW market with it's CLD production? No. But they will sell all they have. And I fully expect they will sell all they make for several years to come.

Judging the speed of our competitors I find most oversupply calls more based on corporate presentations that have proven to be fantasy when faced with design and funding challenges not to mention construction challenges.

Even Moly who is building still seems far of with Phoenix permitting and construction and has resorted to a current convoluted plan instead. The Moly/NEO company seems more focused on marketing downstream away from Lynas rather than posing a major competition threat. And none of this suggests Phoenix is moving faster. In fact, it seems like they are wondering how to sell their products if Lynas Phase 2 is done before Phoenix IMO.

But market size and expansion is also hard to gauge here too. The end markets are very new and several have strong growth rates. And while new markets have sprung up in the last few years, no forecaster models in the possibility of a single new market. How many think Apple will create a new i-something? Many expect that but won't put it in the models. We have seen the Prius continue to grow. Is it possible the hybrid car and truck will become an essential model for each of the big global auto companies? And the renewable energy designs change faster than Hollywood stars change spouses. And most changes go toward REE's and would do so even more if the supply is more reliable.

Call me old, but the oversupply of iron ore, coal, copper, ect. did not play out the way the sorry little rare earth experts predict. In all of those industries the products respond to market growth cycles but remain fairly valuable. So when an expert comes out and says "Geez most of these juniors don't get funded or meet their goals so I'm going to hold my deficit forecast" I'll be impressed. But for now I hear "oversupply in 2013" and wonder if we will be the only modern production by then.

Either way it almost does not matter to Lynas. The fact is Lynas is a clear first mover with great contracts for every element they produce. They also have a capital advantage and will have unencumbered free cash flow. And most of all they have the best resource in the world and likely the first HREE ROW resource to go into production in Duncan.

Lynas holds a stake in NTU because they are a great stock. On their own there is always a place for a non-artic Xenotime mine not under a lake IMO. And if the metallurgy on Duncan proved surprisingly difficult they might buy NTU down the road. But I expect that to prove out as a want rather than a need since reviewing the Duncan drills.

SER, AXE, and MLM are also good juniors but Lynas does not need to be the strategic metal world emperor. Lynas needs to do it's own business right and the rest will take care of itself. Good luck to all and great fortune appears to be Lynas' for the taking.