Pr/Nd oxide up again, market sentiment bullish, page-494

Beijing tested the mkt (and no doubt also enforced supply constraint, to see if there were any leaks) running the prices as high and as quickly as they did.

Clearly they pushed them beyond immediate mkt tolerance, and Nth RE October prices adjusted back to more acceptable levels, but still far higher than what we have seen for probably 18 months or so, without checking.

NdFeB ASP appreciation is a very positive sign (discussing the potential with Ryan from Adamas a couple of weeks ago we agreed it would take several months, due to high margins among mag makers, happened faster than we thought) as it suggests a big chunk of these price increases have stuck, exactly Beijing's purpose, to restore margin all the way thru the supply chain, raise the value add to an important Sino resource.

Reports suggest there is not a lot of inventory downstream, metal/alloy/mag makers, so prices now rebased will be sensitive to a more pure form of mkt demand, but no doubt the Dragon will keep an eye on things.

So much being confirmed ATM, as in admission the bulk of "illegals" were actually coming from the Big6 over producing quotas, too much to cover here as I have to go, but the really important one is China domestic CAGR NdFeB 15.2%, confirming 16% H1 2017, and that's on top of ROW 16% CAGR past couple of years.

Really not sure why anyone flustered on spot pricing when mkt demand is running 15% CAGR and Beijing has effectively demonstrated (at last) supply constraint > March to July operating capacity was reduced 70% to 40%!!!!!!!!!

Dragon can bring "several Lynas' to mkt any time it chooses, but has executed its 5YP objective of restoring value, likely to maintain current values before pushing higher as mkt tolerance develops as there is plenty of overhead margin left in NdPr values, still well short of over head economic threshold.

Anyone seriously believe Dragon will leave that on the plate?