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The world is now waking up to a new shortage looming large. It is in rare earth metals. Rare earth metals are used in a variety of products including LCD screens, offshore wind turbines, navigation systems and automobiles. The metals bind with iron and cobalt to form strong magnetic fields.
Analysts forecast a shortage of 30,000 tons in 2011, as reported in CNBC.com. China controls 97% of rare earth metals production.
The Chinese monopoly and the world shortage are creating problems for producers and users alike. The producers outside China are being forced to increase production. Presently, the big players are Australia's Lynas Corp. (LYSDY) and the US's Molycorp, Inc. (MCP).
To bypass the Chinese, Japanese Sumitomo cut a deal with Molycorp whereby Sumitomo will buy $100 million of Molycorp stock and provide $33 million in debt funding in exchange for 6,000 metric tons of various metals over the next seven years.
Investors can access the rare metals market by purchasing an EFT REMX designed to track this market.
Investors are looking to commodities for investments in 2011. The rare metals market is one promising play, worthy of a look see.
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Reader Comments (Page 1 of 1)
12-14-2010 @ 1:26AM
abigailrpnu said...
Hundreds of blood units are required for patients suffering from blood diseases like anaemia, accidental blood loss, excessive destruction of red blood cells, thalassemia, haemophilia, leukemia and bone marrow transplant.
12-14-2010 @ 2:08PM
william lindblad said...
CNBC is a little late on this information as I know I posted a comment on this at least a month ago.
Actually, this effects Japan manufacturing more than the U.S. Incidentally, there is an old RE mine in Cal. that was put back into operation about a year ago as it now can be operated at a profit. There is also one in Canada that's a start up and seeking investors.
Primarily, this is all about magnets - the small and super ones that are in everything from missle conrols to hard drives and cell phones.