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Investing In Rare Earths

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Rare earth metals are occasionally mentioned in the threads, and I am wondering if there is a way of directly investing in them, like gold.

They are heavy metals, probably toxic, so I don't particularly want bars of them in my living room, but I wonder if there are (regulated) markets for them

I am referring to:

Cerium (Ce) – catalytic converters for diesel engines

Praseodymium (Pr) – an alloying agent for aircraft engines

Neodymium (Nd) – a key component of high-efficiency magnets and hard disc drives

Lanthanum (La) – a major ingredient for hybrid car batteries

Samarium (Sm) – lasers and nuclear reactor safety

Promethium (Pm) – portable X-rays and a nuclear battery

Gadolinium (Gd) – shielding for nuclear reactors, compact discs

Dysprosium (Dy) – improves the efficiency of hybrid vehicle motors

Terbium (Tb) – a component in low-energy light bulbs

Erbium (Er) – fibre optics

Europium (Eu) – used in flat screen displays and lasers

Holmium (Ho) – nuclear control rods, ultra-powerful magnets

Thulium – lasers, portable X-rays

Ytterbium (Yb) – monitoring equipment for earthquakes

Lutetium (Lu) – oil refining

China is the main source of these metals, although there are unexploited deposits in other parts of the world, so I would expect new sources (mines) to open up if demand increases.

A Greenland mining venture was looking for investors earlier this year; that may be a (riskier) investment.

The question is, is there a way for Joe Public to hold and trade these metals?

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Rare earth metals are occasionally mentioned in the threads, and I am wondering if there is a way of directly investing in them, like gold.

They are heavy metals, probably toxic, so I don't particularly want bars of them in my living room, but I wonder if there are (regulated) markets for them

I am referring to:

Cerium (Ce) – catalytic converters for diesel engines

Praseodymium (Pr) – an alloying agent for aircraft engines

Neodymium (Nd) – a key component of high-efficiency magnets and hard disc drives

Lanthanum (La) – a major ingredient for hybrid car batteries

Samarium (Sm) – lasers and nuclear reactor safety

Promethium (Pm) – portable X-rays and a nuclear battery

Gadolinium (Gd) – shielding for nuclear reactors, compact discs

Dysprosium (Dy) – improves the efficiency of hybrid vehicle motors

Terbium (Tb) – a component in low-energy light bulbs

Erbium (Er) – fibre optics

Europium (Eu) – used in flat screen displays and lasers

Holmium (Ho) – nuclear control rods, ultra-powerful magnets

Thulium – lasers, portable X-rays

Ytterbium (Yb) – monitoring equipment for earthquakes

Lutetium (Lu) – oil refining

China is the main source of these metals, although there are unexploited deposits in other parts of the world, so I would expect new sources (mines) to open up if demand increases.

A Greenland mining venture was looking for investors earlier this year; that may be a (riskier) investment.

The question is, is there a way for Joe Public to hold and trade these metals?

Ce is not in many diesel catalysts. It is in ALL petrol catalysts, in far larger amounts. This is important because most car engines in India and alsmot all in China are petrol. Demand is up up up

Nd is in hybrid car batteries AND in the same materials which also contain Ce in autocats. Big car companies have asked whether Nd can be removed from autocats because it is getting v expensive, and will only go up (?).

La, Pr, Y all also in some autocatalysts. La not that rare though, but used in huge amounts (gram scale per car)

Also, not a rare earth, but tantalum goes in capacitors, and is in the spirit of your list for sure.

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bEst way to invest is through producers be careful the market maybe short term over bought.

Try some of these ticker symbols as always DYOR.

TNR, CLQ, MCI, WER, SOI, SQM, PNP, EDV.

I like PNP as its tidgy precious metal miners and rare earths very volatile though.

Good luck.

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Rare earth metals are occasionally mentioned in the threads, and I am wondering if there is a way of directly investing in them, like gold.

They are heavy metals, probably toxic, so I don't particularly want bars of them in my living room, but I wonder if there are (regulated) markets for them

I am referring to:

Cerium (Ce) – catalytic converters for diesel engines

Praseodymium (Pr) – an alloying agent for aircraft engines

Neodymium (Nd) – a key component of high-efficiency magnets and hard disc drives

Lanthanum (La) – a major ingredient for hybrid car batteries

Samarium (Sm) – lasers and nuclear reactor safety

Promethium (Pm) – portable X-rays and a nuclear battery

Gadolinium (Gd) – shielding for nuclear reactors, compact discs

Dysprosium (Dy) – improves the efficiency of hybrid vehicle motors

Terbium (Tb) – a component in low-energy light bulbs

Erbium (Er) – fibre optics

Europium (Eu) – used in flat screen displays and lasers

Holmium (Ho) – nuclear control rods, ultra-powerful magnets

Thulium – lasers, portable X-rays

Ytterbium (Yb) – monitoring equipment for earthquakes

Lutetium (Lu) – oil refining

China is the main source of these metals, although there are unexploited deposits in other parts of the world, so I would expect new sources (mines) to open up if demand increases.

A Greenland mining venture was looking for investors earlier this year; that may be a (riskier) investment.

The question is, is there a way for Joe Public to hold and trade these metals?

I found an industrial supplier for such metals like this.

Can't remember where unfortunately. I'll have a google - but probably not a good buy as they were sold as consumerables with a probable markup.

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Also, not a rare earth, but tantalum goes in capacitors, and is in the spirit of your list for sure.

Definitely, US stocks are depleted after they were selling to various companies at a previous low market rate

The US is now looking to replenish it's stocks from companies that mine it ethically.

In addition Apple, HTC etc etc ALL need this resource.

If you can find a stock out there mining it, tantalum will be a gold mine in the future.

I'm currently invested in a company out in Africa that's re-opening its mine with new management. Hopefully in the new year I'll be able to take out my original investment and leave the rest in risk free :-)

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I found an industrial supplier for such metals like this.

Can't remember where unfortunately. I'll have a google - but probably not a good buy as they were sold as consumerables with a probable markup.

This is the Greenland operation I was referring to.

Greenland Minerals and Energy

Not producing anything yet, and it seems that mining in Greenland may be politically contentious.

Seem to be listed on the Australian Stock Exchange, for some reason. Perhaps that is where the prime investors in the venture are located.

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Is tantalum that rare though?

An anecdote: I used to work for a high-end specialist broadcast electronics company.

We used to soak-test boards overnight ,and occasionaly a tantalum bead capacitor would burn out because it was inserted the wrong way round, or was faulty. The smell was remarkably like TCP. When we got a whiff we would all rush round to find the faulty board before it was damaged by smoke.

On day a guy came in to work after gargling TCP because he had a sore throat. He had all the engineers rushing round in a panic looking for a non-existent faulty board.

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Is tantalum that rare though?

An anecdote: I used to work for a high-end specialist broadcast electronics company.

We used to soak-test boards overnight ,and occasionaly a tantalum bead capacitor would burn out because it was inserted the wrong way round, or was faulty. The smell was remarkably like TCP. When we got a whiff we would all rush round to find the faulty board before it was damaged by smoke.

On day a guy came in to work after gargling TCP because he had a sore throat. He had all the engineers rushing round in a panic looking for a non-existent faulty board.

I don't know about how rare tantalum is, but a quick look on wikipedia would probably tell you. Tantalum is used in low ESR high capacitoance capacitors. I use a fair few of these per board I design. However, although it is the best, it is not the only thing you could use. For example, AVX have a new range of Niobium Oxide capacitors which do pretty much the same job (you can go to www.farnell.co.uk and enter product code 1135188 if you don't believe me).

And here lies the problem in investing in such exotic things, because the minute something becomes really epensive and becomes economical to design out, someone will go and do it.

Saying things like, invest in X, because people HAVE to use it is nonsense, unless it's something absolutely essential like food or water. Show me a material that's used in the elecronics industry that has no alternative.

As for getting hold of rare earths, I use a reasonable quantity of Nd. The thing about Nd is that you can use it to make the strongest magnets. This means you can make sensitive hard drive heads, and get more power out of generators if you use it in these, so it can make wind turbines more efficient. I use Nd, but I don't NEED it. I could use Samarium or a number of other materials instead. Nd just gives more bang per buck. If Nd got too expensive I would use something else.

China has a lot of Nd. It's not the only place that has it though. I think there was a mine in North America, but it shut becuase it was uneconomical. If China reduce exports then mines like this will open up again pretty quickly. I bet there is a lot of Nd in other places in the world as well.

Buying Nd from industrial suppliers is probably a no no. You pay a premium to have certified material for certain uses and if it goes outside the system then it would probably have to be re-certified.

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The best piece on rare earths is the following (from page 18 although the bit on fashion is quite good too):

http://www.zerohedge.com/sites/default/files/TRReport21.pdf

The processors are the most important. The other insight I gained when I was researching this was that light rare earths was going to rise in price faster than the heavy (rarer) rare earths due to market distortion by China.

The thing I got from my research is that rare earths are not rare but extremely abundant. Big ore deposits exist in Africa, Australia, the States, Canada, etc. The problem is with this predatory behaviour from China (this behaviour by a company would be illegal in many countries), that killed most of the competition in the last 20 years by lowering prices and then turns around and restricts exports by 70% odd percent.

What this means is that it will take 10 odd years for the rest of the world to rebuild its mining and processing capacity, as well as the know how that was lost as we don't have the skill base anymore; this should be a good lesson for any other industry China is eradicating in the West.

So although we will rebuild this capacity for ourselves and prices will fall back as there is no 'natural' shortage of ore, we will experience dire shortages in the next few year due to the export restrictions.

I believe China's move will force many a high tech company to move production (and jobs) to China in order to get access to these rare earths.

Some companies I have identified:

AVARF

MCP

LYSDY

GWMGF

UCU

NEM

These have risen a lot already and I can't tell whether they are overpriced already or not.

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If you can find a stock out there mining it, tantalum will be a gold mine in the future.

Try "NVTA", on AIM. 7p, Market cap £25m. Cheap as chips, one to tuck away.

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Guest spp

Try "NVTA", on AIM. 7p, Market cap £25m. Cheap as chips, one to tuck away.

High spinner!

Just took a look at the 3yr chart. Do you have any info on why this never recovered anywhere near its old pre 08 crash level? :o

Undervalued you might say?

You have anymore Rare earth/silver/gold mining penny stocks up your sleeve you'd like to tell us about?

Edited by spp

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visit the Advfn boards enough, and you will find many junior mining companies. Also try minesite.com, and proactiveinvestors.co.uk. I wouldn't put more than £500 pocket change in these juniors, money that you don't need. It's a risky business so spread the money around. Never fall in love with these companies.

Heres a start for you http://www.advfn.com/cmn/fbb/thread.php3?id=21500476 (advfn membership is free)

^ISA - tax planning makes sense also.

I then use sharecrazy.co.uk to find out market cap, shares in issue etc.

----

NVTA - I believe the mine was shut down due to low commodity prices.

Other interesting junior ones include

AGQ - junior silver miner in production 17.5p

TNZ - tanzanite mine in production 10p

Edited by Money Spinner

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NVTA - I believe the mine was shut down due to low commodity prices.

They had other problems too. The mine was producing feedstock that wasn't right for the crushing plant and caused it to break down. They used the shut-down to get the plant sorted and seem to be doing much better now.

I'd suggest staying away from Commerce Resources. They make a good PR release but that's all they will ever produce.

Me? I'm into Gippsland. They are no longer on AIM, but still traded on ASX and Frankfurt. Gippsland are a good example of how frustrating these companies can be. Delay after delay has hit the main project which means that the company has had to raise money to keep going.

When you buy shares in a junior, you've got to be willing to give it time to pay off. That might happen in a year, or it might take a decade. Like money spinner says, use money that you aren't going to want back any time soon (or possibly ever!).

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visit the Advfn boards enough, and you will find many junior mining companies. Also try minesite.com, and proactiveinvestors.co.uk. I wouldn't put more than £500 pocket change in these juniors, money that you don't need. It's a risky business so spread the money around. Never fall in love with these companies.

Heres a start for you http://www.advfn.com/cmn/fbb/thread.php3?id=21500476 (advfn membership is free)

^ISA - tax planning makes sense also.

I then use sharecrazy.co.uk to find out market cap, shares in issue etc.

----

NVTA - I believe the mine was shut down due to low commodity prices.

Other interesting junior ones include

AGQ - junior silver miner in production 17.5p

TNZ - tanzanite mine in production 10p

30p odd now. Anyone got on board?

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Rare earth metals are occasionally mentioned in the threads, and I am wondering if there is a way of directly investing in them, like gold.

They are heavy metals, probably toxic, so I don't particularly want bars of them in my living room, but I wonder if there are (regulated) markets for them

I am referring to:

Cerium (Ce) – catalytic converters for diesel engines

Praseodymium (Pr) – an alloying agent for aircraft engines

Neodymium (Nd) – a key component of high-efficiency magnets and hard disc drives

Lanthanum (La) – a major ingredient for hybrid car batteries

Samarium (Sm) – lasers and nuclear reactor safety

Promethium (Pm) – portable X-rays and a nuclear battery

Gadolinium (Gd) – shielding for nuclear reactors, compact discs

Dysprosium (Dy) – improves the efficiency of hybrid vehicle motors

Terbium (Tb) – a component in low-energy light bulbs

Erbium (Er) – fibre optics

Europium (Eu) – used in flat screen displays and lasers

Holmium (Ho) – nuclear control rods, ultra-powerful magnets

Thulium ™ – lasers, portable X-rays

Ytterbium (Yb) – monitoring equipment for earthquakes

Lutetium (Lu) – oil refining

China is the main source of these metals, although there are unexploited deposits in other parts of the world, so I would expect new sources (mines) to open up if demand increases.

A Greenland mining venture was looking for investors earlier this year; that may be a (riskier) investment.

The question is, is there a way for Joe Public to hold and trade these metals?

Rare earths are expensive at the moment because of a supply squeeze, not because they are particularly rare. In 2 to 3 years time when the mines in Australia and the US start producing, prices will fall. Obviously that isn't much use if you want it in your hard drive or all the other things you have listed now, but it does mean that this is not a good long term investment.

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