Jon Hykawy of Stormcrow Capital on the state of the rare earths market and what’s ahead for prices in 2015.
At Cambridge House International’s 2015 Vancouver Resource Investment Conference, Resource Investing News spoke with Jon Hykawy, president and director of Stormcrow Capital, about the state of the rare earths market and what’s ahead for rare earths prices in 2015.
For 2014, Hykawy said that the biggest surprise was how well the price of praseodymium held up as a separated material. However, he noted that although praseodymium is a magnet material, the price rise was actually due to sales into the ceramic industry. Overall, he saw no real surprises for the year as “prices went down” and “volumes that were used went down.”
That isn’t the most positive picture, but on the bright side, Hykawy added that increased demand is starting to materialize. “We don’t see much further collapse possible … likely this year what we’re in for is a stabilization in prices and a slow increase in those prices moving forward,” he said.
Though Hykawy conceded that the rare earths industry in China is still a mystery, he seemed hopeful that a rare earths industry could in fact materialize outside of the country. He suggested that strategic investors that might finance companies outside of China will consider projects that are:
- long term
- cost competitive
- in a stable geopolitical environment
- producing the materials they need (which he cited as magnet materials)
For Hykawy, companies like Rare Element Resources (TSX:RES) and Arafura (ASX:ARU) fit the bill. Watch the video below for more of what he had to say.
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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