EDITOR: | December 21st, 2015 | 6 Comments

Professor Kingsnorth on the ‘Real State’ of the Global Rare Earth Market

| December 21, 2015 | 6 Comments
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December 21, 2015 — Professor Dudley J. Kingsnorth of Curtin Graduate School of Business and Executive Director of Industrial Minerals Company of Australia Pty Ltd in an interview with InvestorIntel Publisher Tracy Weslosky discuss the rare earth state of the union for 2015. Dudley starts with: “I’ve got a very long-term positive view of the rare earth market and I’ve got grey hair to prove it here. There is a slide that I’ve sent you which indicates that over the last 50 years the rare earth industry has grown by a factor of 30, a gross of 30 over 50 years. That’s very significant.” From discussing overall market growth for the rare earth industry to the processing technology race – Professor Kingsnorth provides a thorough update on not only where we are today, but where we are heading tomorrow.

Tracy Weslosky: Well, Dudley I’d love to start by just commenting on an email you sent me about the, Levelling the Rare Earth Playing Field written by Alastair Neill. You wrote to me by saying, I believe that we all have something to contribute. Rare earths are complex. I do not believe that there is a silver bullet or that one person has all the right ideas. Many are common to each of us while some have a better understanding of a given issue or consideration. So, I would just love to start with the Levelling the Field column and your response to this please Dudley.

Dudley J. Kingsnorth: I thought it was a very good start and as I said, when we look at any project, rare earth project, it’s like the industry itself, it’s fairly complex. There’s many issues that need to be considered before one invests or considers promoting a rare earth project. I think Alastair’s given us a great start. I look forward to identifying a few issues today that I see are important. Undoubtedly other people are going to put other considerations forward to you. I think before Christmas we’re going to have a very complete picture of how we should assess rare earth projects.

Tracy Weslosky: Okay. Well then, let’s just start right there. What issues would you like to bring up immediately?

Dudley J. Kingsnorth: The issues that I would like to bring up immediately are mineralogy and the processing, capital costs and the size of the project.

Tracy Weslosky: Okay. Well, it’s been way too long since you’ve spoken to us at InvestorIntel so we’re delighted to have you. The resource market of course has been very challenged over the last year or two. Can you tell us about the state of the union for rare earths? I was looking at your slide and you were saying that rare earth production was actually up for 2014. Can you give us a bit of an overview?

Dudley J. Kingsnorth: Tracy, I’ve got a very long-term positive view of the rare earth market and I’ve got grey hair to prove it here. There is a slide that I’ve sent you which indicates that over the last 50 years the rare earth industry has grown by a factor of 30, a gross of 30 over 50 years. That’s very significant. I think what we’ve got to be very careful of is not get bogged down by the present problems that we have. Look to the future. Think positive. So whereas today we’re faced with very large amount of illegal production from China and very low prices, I do believe that we should solider on and it won’t be too long before there’s some opportunities for many of those projects out there that are being evaluated at the moment…to access the complete interview, click here


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Comments

  • Jeff Thompson

    Would be interested to know if Professor Kingsnorth thinks the ongoing territorial disputes in the East China Sea and the South China Sea are likely to play any further significant role in the pricing and regionalization of supply/demand dynamics of rare earths? Or are the parties involved more likely to try to play it down and keep a lid on the potentially catalyzing effect a prolonged dispute could have?

    December 21, 2015 - 8:37 PM

  • Alastair Neill

    Dudley. Interesting interview. I do agree that CAPEX is a key component and it is interesting to see the work being done as you mentioned by a number of different companies. However I would propose to put some weighting on the different compositions of ores. The metric could be CAPEX/revenue per tonne of REO produced or ore mined. This will accommodate heavier compositions of Dy and Tb which would require higher CAPEX to separate. Also adds weighting for “light” deposits with higher Nd content. There should also be weighting for percentage of each element sold so that Cerium does not carry an unusual weighting. It also makes a difference if the end product is a concentrate versus separated products.
    Maybe in a future update I will include such a metric based on your comments.

    December 21, 2015 - 9:04 PM

  • Ed Loye

    Nice one Dudley, always good to hear someone talk sense in the rare earth space

    December 22, 2015 - 7:41 PM

  • Dudley Kingsnorth

    1. Jeff: I am not a political analyst so I will Others to make pronouncements on this issue.

    2. Alastair: As you say many factors to consider; but we need to keep it reasonably simple so Investors are not turned-off by over-complicating matters and making out that we understand it all!!.
    There are 4 components to Capex: Mining/Mineral Processing, Dissolution, RE Separation and Infrastructure. Perhaps you and I could exchange notes over the next couple of weeks to come up with a definitive ‘guide’ for InvestorIntel, for Tracy to place on the website.

    3. Ed: Thank you.

    December 22, 2015 - 8:22 PM

  • Positroll

    Considering how prominently Alkane’s Dubbo ZIRCONIA project figures in the above presentation I don’t understand why the most important factor does not get mentioned sooner than at 15:oo : BYPRODUCTS !

    December 23, 2015 - 5:57 PM

  • David Mortimer

    What about UCORE does Dudley think that it has a good chance with its MRT angle .

    December 30, 2015 - 12:13 PM

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