Lynas Signs Contract With Japan Rare Earths Consumer Amid `De Facto' Ban
Lynas Signs Contract With Japan Rare Earths Consumer Amid `De Facto' Ban - Sep 28, 2010 8:32 PM ET
Lynas Corp., building a A$550 million ($532 million) rare earths project in Australia, agreed to supply a Japanese consumer, a day after Japan said China’s “de facto” export ban on the materials may harm its economy.
“Lynas is extremely pleased to sign this contract with one of the leading companies in their specific market,” Executive Chairman Nicholas Curtis said, without identifying the customer. The rare earths will be supplied from the Sydney-based company’s Mt. Weld project and produced at its plant in Kuantan, Malaysia, when it starts up next year.
China, which controls more than 90 percent of the global rare earths market, last week put a de facto ban on exports to Japan of the material, a group of 17 metals used in weapons, hybrid vehicles and laptop computers, Japanese Economy Minister Banri Kaieda said yesterday. Ties between Asia’s two biggest economies soured over the detention of a Chinese fishing boat captain whose ship collided with Japanese Coast Guard vessels.
“The company anticipates further contract announcements over coming months”, Curtis said in the statement. It is in talks with potential customers in Europe, Japan and the U.S., it said.
Lynas climbed 2.3 percent to A$1.355 at 10:15 a.m. in Sydney trading, taking its gain for the year to 147 percent.
Japan takes about 65 percent of China’s rare earth exports, according to a Sept. 24 report by Macquarie Group Ltd. One of the Japanese sectors most at risk from a disruption in rare earth imports are automakers such as Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co., all of which require rare earth elements for vehicle development, Macquarie said.