Who's interests align with Lynas? My guess is Japan, but more...

Who's interests align with Lynas?

My guess is Japan, but more specifically the Japanese automotive industry.

5.5 million people, or 8.7 percent of Japan's workforce are employed in automotive industry.

If the auto industry declines then Japan declines.

The industry is now competing with China who have the benefit of cheaper resources such as RE that are integral to electric vehicles (EVs).

The Japanese auto industry must act to ensure adequate supply of RE in the race to capture EV market share.

Lynas is the only producer of NDPR outside of China and Japan should be doing whatever it can to ensure that:

• Lynas continues to operate successfully and grow the supply of NDPR; and

• supply from Lynas finds it's way to Japanese industry.

This is already partly being achieved with the arrangement with Sojitz and JOGMEC for allocation of 8,500 tonnes (±500 tonnes) per annum of Rare Earths products for Japan.

With Lynas now in a position to fund an expansion of the LAMP, Japan should again be seeking to ensure that it captures the outputs.

An attractive deal for Lynas is something that doesn't require upfront cash and continues to grow the market for RE.

Doing a deal with a single Japanese car maker or magnet maker will exclude and alienate many others, some of whom might look for alternatives, which does not align with interests of Lynas.

Japan Oil, Gas and Metals National Corporation (JOGMEC) is an incorporated administrative agency established by Japanese government.

It's role is to secure a stable supply of natural resources and energy to Japan.

JOGMEC should be at the forefront of an arrangement with Lynas to secure and distribute RE to all of the Japanese industry.

The consequence of not acting quickly is that China will step in and secure off take agreements and the Japanese auto industry are left without enough RE.

Lynas is in the enviable position where it can potentially negotiate a deal with JOGMEC to expand the LAMP at little or no cost to shareholders.

No peer indeed.