General discussion (MEI), page-5150

What's next?

In April, Citi downgraded Lynas to a 'Sell' rating, citing a bleak outlook for rare earth prices and rising cost expectations.
The analysts expect NdPr oxide prices to average US$54.7/kg in 2024 and improve to US$64.8/kg in 2025 and US$74.9/kg in 2026.

While prices are forecast to bottom over the next 12-24 months, the current trend is quite clear. However, recent geopolitical tensions could potentially provide some price support. …….Notably, the US plans to implement a 25% tariff on Chinese graphite and permanent magnets rare earths in 2026, up from the current 0%.

While rare earths are strategic, it's by no means an easy business.

The project's leverage is evident in these figures. The contrast between US$45 and US$21 (re 'basket price TREO') highlights the dramatic impact that price can have on the project's financial outcomes. Most notably, the post-tax NPV plummets from US$699 million to a mere US$16 million under current spot price conditions.

Meteoric says its Caldeira will have an estimated all-in sustaining cost of an initial US$7/kg, which will rise to US$9/kg over the 20-year life of mine period. This positions the project as one of the world's lowest-cost producers.

Despite this advantageous cost profile, the project's economics remain challenging. Rare earth prices must rise significantly for truly compelling returns.

DYOR please