Lynas to withhold supply after rare earths price plunge
Lynas Rare Earths will withhold a portion of supply from the market in response to a plunge in prices for the key ingredient in wind turbines, electronics and military applications.
The world’s biggest supplier of rare earths outside of China said the lower prices were linked to softer demand for permanent magnets in Japan, and to oversupply in rival producer, China.
Lynas Rare Earths boss Amanda Lacaze. Trevor Collens
Lynas said its stockpiling was also insurance against potential teething problems in duplicating a portion of its downstream processing at Kalgoorlie in Western Australia, in response to regulatory demands imposed by Malaysia.
The Lynas downstream operations at Kuantan in Malaysia produced a record 1864 tonnes of neodymium and praseodymium (NdPr) in the June quarter from rare earths mined at Mount Weld in WA, which also achieved record production amid a big expansion.
The average Chinese domestic price of NdPr slid from $US86.60 ($129.70) a kilogram in the March quarter to $US60.30 a kilogram in the June quarter, and down from $US120.40 a kilogram in the same period last year.
Lynas’ sales revenue for the quarter was $157.3 million, down from $294.5 million a year ago, and from $237.1 million in the March quarter.
The move to withhold some supply from a weak market comes six months after the Albanese government warned Malaysia that a drop in production from Lynas’ Malaysian facilities would have a detrimental impact on global rare earths supply chains.
The warning came as Lynas lobbied Malaysia to scrap a June 30 deadline for it to stop performing a process known as cracking and leaching at Kuantan.
Malaysia eventually relented and gave Lynas until December 31 to stop cracking and leaching. Lynas is
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