Japanese Firm Secures Rare Earth Supplies

Michael Montgomery—Exclusive to Rare Earth Investing News

The world is trying to diversify supplies of rare earth elements away from the monopolistic power that China currently holds. After the reduction of quotas, and a non-official embargo on rare earth elements, the scramble to find and produce REEs was shifted into high gear. A rush of investment capital flooded the market, helping share prices of many junior mining companies surge, and Japan signed a deal with Vietnam for the exploration of rare earth deposits. In the US, Molycorp went public with a highly publicized IPO and started selling REE from old tailings from their Mt. Pass, California mine. Half of China’s REE exports are currently shipped to Japan for the production of a host of high tech goods. The world’s leading economies and tech companies are no longer willing to bet their bottom lines on reassurances from China that rare earth supplies will continue.

In a continuing need for stable rare earth supply, Japanese importer of the metals Sojitz Corp., has singed an off-take agreement with Lynas Corporation (ASX:LYC) which mines rare earths on its Mt. Weld property in Australia. The US$250 million deal will help Lynas advance their Mt. Weld property as well as the company’s processing plant in Kuantan in eastern Malaysia.

“Sojitz, the top Japanese trader in rare earths, said it had forged a deal with the Australian mining company Lynas to start shipping 3,000 tons a year of the minerals from a new mine, Mount Weld, beginning late next year. Sojitz and Lynas, based in Sydney, aim to increase shipments to more than 9,000 tons a year by early 2013,” stated Satoshi Mizui, a Senior Vice President at Sojitz Corp.

The move by Sojitz is another example of companies actively pursuing stable supplies of REE’s. This same Japanese firm is partnering with Toyota Tsuho Corp, the REE importer for Toyota Motors, in Vietnam to advance rare earth mining.

Earlier this month, Molycorp Inc. (NYSE:MCP) signed an off-take agreement with W.R. Grace & Co. for the production of additives for petroleum refining. The agreement is for Molycorp to “sell more than 75% of its lanthanum production each year to W.R. Grace & Co. following expected 2012 completion of a new state-of-the-art production facility at its Mountain Pass Mine in California,” reported Phillip Burget, for Resource Investor. The companies Mt. Pass mine has yet to produce any new material, relying instead on old tailings from the site. Molycorp expects to have full production from the site by 2012.

Rare Earth Mining News

Commerce Resources Corp. (TSXV:CCE)(PINK:CMRZF) received an OTC listing in the US trading on the OTCQX. The listing, labeled under the ticker symbol, ‘CMRZF,’ will help the company secure investors from the US. “We are pleased to be able to provide our current and potential U.S. investors an improved platform to access our company’s securities,” stated Dave Hodge, President of Commerce Resources.

Commerce has released drilling results for its Eldor Lake property in Northern Quebec. The results include a significant level of ‘heavy’ rare earths in high demand for many high tech products. “The company found Total Rare Earth Oxides in the amount of 3.0% at the EC10-046 hole, and 2.25% at the EC10-047 hole. The company said that the four most abundant rare earth elements found in the two test holes were cerium, lanthanum, neodymium and praseodymium,” stated the article from International Business Times. These results are very promising, the high percentage of rare earth oxides on the site are equal to that of top world class deposits.

The results from Commerce Resources drilling of Eldor lake has prompted Candorado Operating Company Ltd. (TSXV:CDO) to sign an agreement to purchase a property adjacent to Eldor Lake. “The acquired ground totals approximately 920 hectares and adjoins Commerce’s Eldor Property to the northwest. Commerce announced on November 24, 2010 the latest results from its drill program on the Ashram REE zone, which confirmed the potential for a large, near surface deposit of REE mineralization,” reported AZOmining.