hey Danieli think a few hundred million might be an over...

hey Daniel

i think a few hundred million might be an over inflated estimate

when I calculated the raw cost of the materials needed to produce 2000 tonnes of NdFeBn, 99.9% of those costs are from Nd, with Iron and Boron very cheap compared to Neodymium which makes up about 27-30% of the alloy, 1% being boron and 69-72% being iron.
we dont know how much margin ASM is making nor the final price for their NdFeB alloy they are onselling. If there is 100% mark up on raw material price of 60 million, then they will sell approx 120 million of product but only once they are making 2000 tonnes a year. So that would require a rapid ramp up of noveon and US rare earths in terms of their production of magnets. Both companies in the US have stated there is excess demand of high performance NdFeB magnets so it makes sense they rapidly ramp up. But US Rare Earths are needing to upgrade really old manufacturing equipment before they can start manufacturing commercial levels of magnets they have stated.
i believe past calculations from a year or so ago stated each plant like the KMP would generate 40-50 million ebitda positive cashflow per year once at name plate capacity of 5200 tonnes a year. I believe that 5200 tonnes a year name plate capacity wont be achieved until 2025 at earliest, unless they sign another 3-4 binding offtakes the same size as US rare earths.

i believe ASM are in talks with Noveon to strike a binding multi year agreement. Noveon have ambitions to produce thousands of tonnes of magnets in 2024. So it makes sense given this short term 100 tonne agreement with Noveon, once Noveon secures offtakes for its high performance magnets we will then see a lock in contract to supply Noveon with a lot more quantity of alloy.

we should now keep an eye on the success of both US Rare Earth and Noveon as they both need to secure agreements for their magnets in order to create the demand needed of ASM making them the exact specification alloy to make those magnets.

imo