Messecar scrutinizes the nearly 70% collapse in rare earth prices over a span of two years, prompting her to question the underlying factors driving this drastic decline.
Key highlights from the article include:
- An exploration of why investors are struggling to predict rare earth prices despite their significant impact on industries like automotive and energy
- Comments from industry figures like Amanda Lacaze, Jim Litinsky, and Rahim Suleman highlight the challenge of forecasting rare earth prices accurately
- The fact that forecasting remains difficult, leading Messecar to analyze potential price drivers
- Messecar considers factors such as a pause in EV demand, a global economic downturn, market volatility, and geopolitical tensions
- Weaker EV demand may have influenced prices, the decline cannot solely be attributed to it due to the widespread use of rare earth magnets in various industries
- A discussion about the global economic downturn as a potential driver, citing oversupply in the rare earth market and increased production quotas in China
- Questions about whether the economic downturn alone could account for such a significant price drop
- Market volatility, including a 300% increase in NdPr oxide prices between March 2020 and March 2022, is also examined, considering factors like COVID-19, inflation and industry consolidation
- The role of geopolitics, particularly in the US-China trade war, as a factor influencing prices
Read the full article here: Why have rare earth prices fallen? – MMTA
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