Rare Earth

rare earth magnets
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What are the top Canadian rare earths stocks? These companies on the TSX and TSXV have performed the best so far this year.

Click here to read the previous top Canadian rare earths stocks article.

Rare earth elements (REEs) have had a strong showing so far in 2022.

Investors may not be very familiar with the metals individually, but the group of elements is found in technology all around us, commonly in the form of rare earth magnets, which are used in everything from electric vehicles to smartphones to wind turbines. As technology continues to advance, they will remain in high demand.

“The simplest engineering solution for a drive train on an electric vehicle is to use a permanent magnet synchronous motor, and those permanent magnets are made of REEs,” Jon Hykawy of Stormcrow Capital told the Investing News Network. "So as that trend continues, I expect the prices to remain high."

Another long-term story in the REE market is China's dominance of the overall industry. With geopolitics at the forefront of people's minds, especially following hits to commodities supply chains during Russia's invasion of Ukraine, the focus on attaining domestic sources for critical metals has been mounting.

Here the Investing News Network looks at the TSXV- and TSX-listed REE companies that have had the biggest gains during 2022. CSE-listed companies were considered, but did not make the cut this time around. This top Canadian rare earth stocks list was compiled using TradingView’s stock screener, and data was gathered on August 15, 2022.

1. Marvel Discovery(TSXV:MARV)

Year-to-date gain: 33.33 percent; market capitalization: C$10.4 million; current share price: C$0.10

Marvel Discovery is focused on prospects and projects for many different metals throughout Canada. In terms of rare earths, the company has its Wicheeda North project in BC, which is contiguous to Defense Metals' (TSXV:DEFN,OTCQB:DFMTF) Wicheeda REE project in the Rocky Mountain rare earths belt. Defense Metals’ project hosts 4.89 million metric tons (MT) at 3.02 percent light rare earth oxide. Marvel also holds gold and nickel projects .

In May, the company shared exploration results from Defense Minerals’ Wicheeda project, including a highlight of 3.09 percent total rare earth oxide over 251 meters, with 3.92 percent over 80 meters. The following week, the company announced a joint venture with the purpose of expanding its land position in the Rocky Mountain rare earths belt. It can earn a 50 percent interest from Eagle Bay Resources by completing at least two drill holes.

“We are very excited with the current developments coming out of the Wicheeda Camp,” Marvel Discovery President and CEO Karim Rayani said. “Marvel is in a great position now as we control a sizeable area of influence, and we look forward to working with our new partner Eagle Bay Resources to explore this new territory.”

2. Ucore Rare Metals (TSXV:UCU)

Year-to-date gain: 27.03 percent; market capitalization: C$46.63 million; current share price: C$0.94

Ucore Rare Metals is focused on addressing the lack of a rare earths supply chain in the US. The company and its subsidiaries own the Bokan-Dotson Ridge REE project on Alaska’s Prince of Wales Island. According to Ucore, it’s the US’ highest-grade heavy REE resource. Through its subsidiary Alaska2023, the company is planning a 2,000 MT per year heavy and light REE separation and purification facility that will have three US-allied feedstocks.

Ucore’s share price spiked to start the year, hitting a year-to-date high of C$1.24 on January 14. In April, the company released conclusions of a technical third party review of its RapidSX REE separation technology. It compares favorably to conventional solvent extraction, including being three times as efficient, having a facility footprint two-thirds the size and a lower capital expenditure, among other points. In May, the company mobilized a crew to work on its five week summer exploration program at the Bokan project.

Recently, the company shared updates on its REE demo plant’s progress, including the news that product qualification trials will begin in Q4. “The enhanced Demo Plant will also be able to produce limited amounts of saleable Pr, Nd, Tb, and Dy oxides — a noteworthy milestone for critical materials independence in North America,” the company said in a press release at the time.

3. Avalon Advanced Materials (TSX:AVL)

Year-to-date gain: 45.45 percent; market cap: C$61.32 million

Avalon Advanced Materials is focused on Canadian critical metals projects, with a portfolio that includes rare earths, lithium, cesium, tantalum, feldspars, tin and indium. Its Nechalacho REE project at Thor Lake, Northwest Territories, is currently in the feasibility phase. In 2022, the company's main focus has been its Separation Rapids lithium project.

Avalon’s share price spiked in early April following the announcement of a partnership with RenJoules International to establish a regional lithium battery materials supply chain in Ontario. The next steps outlined in April include completion of feasibility studies for the refinery and concentrate production at the Separation Rapids site. The news drove Avalon’s share price to C$0.22. The gains were short-lived, but the company is still up year-to-date.

What are rare earth minerals?

Rare earths are a category of elements that share many chemical properties. In fact, all but two — yttrium and scandium — are also called lanthanides. These elements are commonly found in the same deposits and are necessary for diverse technological applications such as rare earth magnets.

How many rare earth elements are there?

In total there are 17 elements that make up the rare earths category, and they are split into light and heavy rare earths. On the light side, there are cerium, lanthanum, praseodymium, neodymium, promethium, europium, gadolinium and samarium, and on the heavy side there are dysprosium, yttrium, terbium, holmium, erbium, thulium, ytterbium, yttrium and lutetium.

Where are rare earth metals found?

In terms of both reserves and production, China is the frontrunner for rare earth metals by a long shot, with 44 million MT of reserves and 168,000 MT of production in 2021. However, Vietnam, Brazil and Russia all also have reserves above 20 million MT. With regards to production, though, the US is in second place at 43,000 MT due to the Mountain Pass mine in California.

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Securities Disclosure: I, Lauren Kelly, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: Avalon Advanced Materials and Marvel Discovery are clients of the Investing News Network. This article is not paid-for content.


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