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Positive Quarterly Results at Lynas and MP Materials

August 2021 | Market

Lynas MP Materials Profit
Image: iStock/kanawatvector

Lynas, the largest producer of rare earths outside of China, reported record figures for the fourth quarter in July. At 115.94 million euros, the Australian company’s quarterly sales more than tripled compared to the same period last year. Neodymium and praseodymium were particularly in demand, Lynas CEO Amanda Lacaze said according to the Reuters news agency. The production volume of the two rare earths has almost doubled year-on-year.

In addition to the generally increased demand for strategic raw materials for future technologies such as wind power or electromobility, the efforts of many countries to diversify their international supply chains also contributed to the positive development. This is intended to reduce dependence on China’s raw material exports. So far, about 90 percent of the rare earths come from the Middle Kingdom.

New Sources of Raw Materials Sought

The European Union is also interested in raw materials from Australia. At the end of June, an EU delegation accompanied by the Governor of Western Australia, Kim Beazley, visited the Mount Weld Mine, the largest rare earth deposit outside of China. The mine, which is owned by Lynas, has been in operation since 2011 and could make a major contribution to the international supply of raw materials, according to Governor Beazley.

The international marketing of Australian products is supported by the state. As part of the Modern Manufacturing Initiative, Lynas has received the equivalent of a good 9 million euros in grants for the integration of a new finishing process, Reuters reports at the end of July. The process is used for the production of high-purity rare earth carbonate. It will be used in the planned plant in Kalgoorlie, Western Australia, which will cost over 300 million euros to build. Further processing takes place in Malaysia. Lynas is also planning to build a processing plant in Texas. The U.S. Department of Defense will provide financial support for the construction project, according to Reuters.

MP Materials Wants to Set Up Production in the USA

MP Materials, the largest producer of rare earths in the Western Hemisphere, also recorded a positive quarterly development. The Las Vegas, Nevada-based company reported a profit of $27.2 million. In the same period last year, MP Materials had to cope with a net loss of $62.5 million due to one-off charges, according to a press release. According to CNBC, the most important buyer of the raw materials extracted by MP Materials at the Mountain Pass Mine in California is the Chinese company Shenghe Resources. Shanghe holds almost 8 percent of the shares in MP Materials and takes over the distribution of the material for further processing in China. MP Materials now also wants to build up this part of the value chain in the USA. The site for a processing plant is to be announced later this year, CEO James H. Litinsky said at the presentation of the quarterly figures. This project is also funded by the US Department of Defense. Starting in 2023, MP Materials plans to produce about 6,000 tons of neodymium and praseodymium in California, Reutersreports.

Image: iStock/kanawatvector

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