China Begins Hoarding Rare Earths; Molycorp (MCP), Avalon (AVL) Trade Higher
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Rare earth stocks are moving higher Monday Thursday following reports from the China Securities Journal (as translated by ZDNet) that China might be hoarding the minerals as prices continue to fall.
With China tightening supplies, this provides an opportunity for companies like Molycorp (NYSE: MCP), Avalon Rare Metals (AMEX: AVL), and Rare Earth Resources (AMEX: REE) to gain on increasing prices.
The China Securities Journal also said China had planned to stockpile rare earth elements, but did not publicly disclose its intentions to do so. China has been berated by the World Trade Organization (WTO), Office of U.S. Trade Representative (USTR), Japan, and others over its rare earth export controls. China produces about 90 percent of the elements -- which are used in automobiles, electronics, and medical devices -- used each year.
Shares of Molycorp are up 3.9 percent, while Avalon is 6.5 percent better and Rare Element is up 1.8 percent.
With China tightening supplies, this provides an opportunity for companies like Molycorp (NYSE: MCP), Avalon Rare Metals (AMEX: AVL), and Rare Earth Resources (AMEX: REE) to gain on increasing prices.
The China Securities Journal also said China had planned to stockpile rare earth elements, but did not publicly disclose its intentions to do so. China has been berated by the World Trade Organization (WTO), Office of U.S. Trade Representative (USTR), Japan, and others over its rare earth export controls. China produces about 90 percent of the elements -- which are used in automobiles, electronics, and medical devices -- used each year.
Shares of Molycorp are up 3.9 percent, while Avalon is 6.5 percent better and Rare Element is up 1.8 percent.
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