It is not all externally driven, also influenced by Lynas' ability to firstly identify customers prepared to pay a premium for higher spec product then to process to ppm requirements and pass a qualification process/period.
Considerable progress has apparently been made with Mt Weld ore (with it's own unique composition), some incremental premiums being realised, but still a long way to go, particularly to catch up with Dragon high end.
A sharp eyed SH posted what appeared to be an add for a QC Mgr earlier this year, in fact it was, as I discovered later, for one of the three research chemists that have been employed on this project. This is not simply a Lynas initiative but the established trend in the RE industry that appears almost totally unreported/unknown by the glitterati commentariat in the space, and the wannabes over writing "toll process" into their Fantasy Studies.
Lynas are totally unique ROW in this development, proprietary process of single source ore to multiple mkt aps, and light years ahead of the wannabes with their dinky little pilots, and boasts they've got the process down pat, lol. They seem blissfully unaware that Lynas issues were NOT with chemistry but balance & control of material flows at scale.
ATM most of this value is added in the MSC to individual requirements, small batch process, where it can be done far more cost efficiently at large scale point of primary process. I.e. Rhodia were reportedly spending $5kg reprocessing & blending Chinese La & Ce at La Rochelle for their autocat inputs. Not rocket science to work what say $3kg x 15ktpa LaCe would do to Lynas revenues ATM, and off a LT average base price of $5/6kg what others are conveniently proposing to discard, at cost, would be profitable.
But as above this upscaling is now the industry norm, China recently reporting 50% of production is now 4N's or better, no doubt a combination of improved process and deleting old, but there has been a gross oversupply of low end RE dragging down prices against weak domestic demand.
Perhaps some signs emerging supply finally coming into balance with weaker domestic demand:
"BEIJING (Info-RE) 31-Oct-16 Praseodymium/neodymium market has been running relatively steadily over the past few days with buyers coming back into the market for stable purchases and suppliers holding steady prices.
99% praseodymium/neodymium oxide is still available about RMB245,000/tonne($36,251/tonne) for the moment, similar to prices seen last week.
Meanwhile, suppliers maintain 99% praseodymium/neodymium metal about RMB315,000/tonne($46,609/tonne), and both lower RMB313,000/tonne($46,313/tonne) and higher prices of about RMB317,000/tonne($46,905/tonne) are also being reported in the market.
A number of market players said that downstream consumers have been restocking praseodymium/neodymium recently after their weeks of absence from the market, which has encouraged positive market sentiment. Some suppliers believe that prices might keep firming in the days to come.
Nonetheless, many sources comment that it might be difficult for prices to see sharp rises in the near future as buyers would stop restocking if prices had sharply moved up. Most market players hope that the market could keep relatively steady in the coming weeks."
Maybe if the Dragon can sort it's dysfunctional concentrate tax by value into something workable it might provide some further incentive.
LYC Price at posting:
5.6¢ Sentiment: Hold Disclosure: Held
(20min delay)