It appears that the end of the breathtaking price hike for rare earth materials is finally over, with reports that there will be a surplus by 2013 and even China looking to import.
That's according to the Wall Street Journal. As the world’s largest producer of rare earth materials, accounting for 90 percent of the world’s production, China kicked of the meteoric rise in prices following a long period of relative stability through the nineties and throughout the last decade.
The decision for China to cut its exports by 40 percent kickstarted a climb from an average of between $5 and $20 a kilogram before jumping from just $10.32/kg in 2009 to a massive $13 recent average and also involved a stand off with the world’s largest importer, Japan.
All of which meant a swift increase in the share price of mining companies both inside and out of China as country’s have begun to clamour to grab hold of alternative sources.
It seems that the soaring prices that have been seen of late are expected to come down, with Goldman Sachs analsysts predicting a peak this year, with the supply/demand deficit of 18,734 tons this year eventually heading to a surplus in 2013.
However it could be 2015 before prices are lowered closer to the average seen before the China lead price hike.