Monday, April 4, 2011

Rare Earth Oxide Price Update

We often use one early to market rare earth producer's weighted average price per kilogram as a proxy for what the rest of the market is doing.  In the absence of a major exchange this is currently the best way to keep track of the underlying fundamentals that will be driving our stock positions as soon as the snooze function breaks on the media's alarm clock.

The rise in price experienced in these elements is absolutely staggering.  In one year prices have risen more than 8 fold including the 22.2% advance last week alone!  Could someone please email the Wall Street Journal and bring this to their attention?  Maybe they will pick up the story once we are unable to replace smart bombs used to drive from power cooperative puppet regimes in MENA (Middle East & Northern Africa) that have allowed us to control the region for 55 years?  Every smart bomb requires Neodymium magnets to properly operate the small robotic tail fins that direct them into the bridge that is blow up in order to create a new IMF loan to pay Halliburton 3x market rates to rebuild it.  War is the most profitable business on earth.

Another possibility is that once the cooperative MENA regimes are removed and unsuccessful oil supply negotiations with the Muslim Brotherhood create $9/gallon gasoline Toyota Prius demand will be unmeetable due to the 15kg of Lanthanum required to produce only the car's battery system.

When will Phase IV of this rally begin?  When will a supply shock experienced by a sovereign government or a major producer of a product demanded by the masses make headlines?  When will actual fundamentals drive this market?

We will wait patiently holding only the best of this misunderstood sector.  Our readers have been given the metrics that should be used to pick the best names in the sector.  The divergence of oxide prices and equity prices creates a form of pressure.  This pressure can only be released by falling oxide prices or rising equity prices.  We predict the latter.
Prices as of 3/28/11

Rare Earth Oxide
Distribution
2007
2008
2009
Q3 2010
 Q4 2010
28/03/11
Lanthanum Oxide
25.50%
3.44
8.71
4.88
23.67
52.49
103.10
Cerium Oxide
46.74%
3.04
4.56
3.88
23.05
52.62
98.60
Neodymium Oxide
18.50%
30.24
31.90
19.12
55.81
81.38
180.00
Praseodymium Oxide
5.32%
29.05
29.48
18.03
54.37
78.62
160.50
Samarium Oxide
2.27%
3.60
5.20
3.40
14.40
36.58
95.60
Dysprosium Oxide
0.124%
89.10
118.49
115.67
281.54
287.85
530.00
Europium Oxide
0.443%
323.90
481.92
492.92
585.31
611.54
900.00
Terbium Oxide
0.068%
590.40
720.77
361.67
593.38
620.38 
905.00
Av. Composition

11.59
14.87
10.32
16.02
62.18
122.93

Prices as of 4/4/11


Rare Earth Oxide
Distribution
2007
2008
2009
Q3 2010
 Q4 2010
04/04/11
Lanthanum Oxide
25.50%
3.44
8.71
4.88
23.67
52.49
123.10
Cerium Oxide
46.74%
3.04
4.56
3.88
23.05
52.62
120.60
Neodymium Oxide
18.50%
30.24
31.90
19.12
55.81
81.38
220.00
Praseodymium Oxide
5.32%
29.05
29.48
18.03
54.37
78.62
215.00
Samarium Oxide
2.27%
3.60
5.20
3.40
14.40
36.58
120.60
Dysprosium Oxide
0.124%
89.10
118.49
115.67
281.54
287.85
646.00
Europium Oxide
0.443%
323.90
481.92
492.92
585.31
611.54
1000.00
Terbium Oxide
0.068%
590.40
720.77
361.67
593.38
620.38 
1085.00
Av. Composition

11.59
14.87
10.32
16.02
62.18
150.20

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