Rare earths stocks rise in Asia
City Index November 23, 2012 10:41 AM
<p>Asian markets were largely quiet on Friday given soft offshore leads in the absence of the US market, closed for Thanksgiving holidays. The clear standout […]</p>
Asian markets were largely quiet on Friday given soft offshore leads in the absence of the US market, closed for Thanksgiving holidays. The clear standout performers in Asia today were rare earths producers. Shares in the producers of this type of commodity were higher on the back of comments from Chinese officials disclosing plans by the government to pump cash into local producers. According to media reports citing Chen Zhanheng – deputy secretary general of China Rate Earths Industry Association – the central government may provide annual subsidies of around $40m to the industry in order to restimulate mining activity.
China produces around 90% of the world’s rare earths supply. Rare earths are mostly used in electronic components, catalytic converters in cars, aircraft engines and many other industrial applications. Australian listed emerging producer of rare earths Lynas Corporation was among the best performing stocks on the market today, despite having gone through a very messy political, legal and social process in 2012, it seems like the company is ready to start processing ore in its Malaysian plan over the next few weeks. Shares in Lynas closed almost 7% higher. Hong Kong listed China Rare Earth jumped almost 5% on the government report, while China Resources Enterprise (also listed in Hong Kong) managed a 2% gain.
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