Basically Dy is not investable as a commodity, particularly as hard rock companies like NTU & Ucore have tried to represent to investors for many years, largely on the back of Jack Lifton's ridiculous "heavies" mantra.
When you examine every "HRE" deposit, even the supposed "high grade" such as NTU, you will find the in-situ grades are tiny, Browns Range 0.053% vs Duncan 0.061%.
While the Duncan Dy grade is slightly higher it comes as a part of total TREO 4.84%, of which 23.5% NdPr.
By comparison Browns Range total TREO 0.63%, of which 57% is virtually unsaleable Yttrium.
Ucore's Bokun is even worse, 0.025% Dy in-situ, of TREO 0.60%, and if you look around you'll find all the "heavies" prospects are similar, low grade, one trick ponies.
By comparison when you mine Duncan for every 300tpa Dy you get 5093tpa NdPr & 5136tpa La, etc, in effect the Dy is a by-product with the principal economic rationalisation for the project being the NdPr. Numbers taken from the old scoping study:
Lynas now taking a different route as they've worked out how to process Duncan ore blended with CLD and basically upgrading the HRE content then produced as a carbonate from the first separation stage at LAMP.
Simply going to attach a round number CoP of $10kg at that point with virtually no additional OpEx or CapEx beyond the basic LRE operation. Compare that to total costs of getting any of the hard rock "heavies" resources to the same point. The Chinese of course "mine" ionic clay resources with acids & other toxics, low monetary but massive environmental costs, which they are finally addressing.
"Punting Dy 2020, as smart as horseshoes 1920" speaks to the poor economics of those projects promoted as "heavies" resources, they struggled to make any sense of them at $600/700kg and doubt we'll see those prices again anytime soon.
It does not reflect on the relevance of Dy although I've commented numerous times on the dramatic reduction of content in NdFeB, which is ongoing but the bulk of the volume has probably already been taken out. Given the projected growth NdFeB, and particularly the rotation to high end NdFeB, it is a given that demand for Dy will increase strongly but nothing like the failed forecasts of the paid for pumpers. Want a flash Dy Deficit forecast MkII, we don't talk about MkI, pre CR? CAD20,000 will get it done in high gloss. Sorry, some of what has gone on in this "industry" has been appalling.
So despite Lynas low cost of feedstock produced as a LRE by-product ~$10kg pre separation they refer to the project as "strategic" & downplay expectations +CF. They are very confident they have a cost effective process plus a ready ROW mkt in Japanese mag producers, but initial volumes will be quite low for several years and REO processing is a business that needs scale to produce effective returns on capital.
So demand/price improving where does Lynas harvest greater volumes of cost effective by-product beyond MtW? Won't go into them now but multiple monazite sources will develop and Lynas will have the only cost effective process to take them to product plus full engagement ROW end users. Hard rock wannabes still gasping for funding looking like carp at a dam wall.
Basically DyO/TbO will be produced from monazite host LRE by-product, as such it is not possible to invest directly.
LYC Price at posting:
$2.85 Sentiment: Buy Disclosure: Held
(20min delay)