Rare Earths are not so Rare and there is a mug born every minute

So it turns out that  Rare Earth elements (REE) are not rare!  REE are not rare in that they are common in the earth’s crust and disseminated in rocks ranging in concentrations from 150 to 220 parts per million which even exceeds copper (55ppm) and zinc (70ppm).  Unlike most commonly mined base and precious metals it is very rare to find REE concentrated into mineable deposits.

When dealing with REE it is important to know not just grade of the resource to initially gauge the potential economics of a deposit but particularly when dealing with these elements to have an early indication of the cost of mineral processing.  It is one thing for the rock to contain the element but another thing to liberate and recover it.  It may be prohibitively expensive to convert an REE deposit into ore – in fact it might be a rather rare occurrence.

Mining, refining, and recycling of REE has serious environmental consequences if not properly managed. A particular hazard with some projects is the possible generation of mildly radioactive slurry tailings resulting from the common occurrence of thorium and uranium in rare earth element ores.

Global demand for rare earths has increased as more uses for these elements are found. Today there are hundreds of uses for REE, ranging from high-tech, energy and industrial.

The catalyst for the sudden interest in REE was China’s announcement in June 2010 that it was curtailing rare earth element (REE) exports and also increasing export taxes.  The investor frenzy probably peaked in early to mid-2012.  At least this was the announcement which got traction with some opportunists which may have included a few super networkers in their number.  Of course it was convenient at the time not to focus on the fact that China had been doing exactly the same thing by “creep” for the previous two years, something at that time which had not mattered to the market but now conveniently did.

REE became hot and the galácticos of the speciality metals and it was suddenly easy for REE projects to suddenly be on the receiving end of a wall of silly punt-money.

I read recently that just over 700 public companies globally  were promoting REE projects, many with management that had little or no idea of what was really involved in putting a REE project into production.  This of course was no barrier for the opportunistic promoters of junior resource companies.  And on the speculation side, well, as we all know there is a mug born every minute and fools are easily parted with their money.


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