Rare earths and rare earth stocks aren’t as hot anymore with stocks like Molycorp (NYSE: MCP), Rare Element Resources (NYSEAMEX: REE), NioCorp Developments (PINK: NIOBF) and Great American Energy (OTC: SRBL) producing rather mixed news lately. The worst of the news seems to have come from Molycorp which recently announced a filing delay for its latest earnings report because of a noncash goodwill impairment charge that will be "substantial." Specifically, Molycorp needs to take the impairment charge for its acquisition of Neo Material which is bought for $1.3 billion. That bit of news seems to have even Mad Money’s Cramer (for what his advice is worth) once again telling viewers to dump shares of Molycorp or at least not to chase after the company now that its hitting all time lows.
However, its not all bad news coming out of the rare earth sector with the following be some of the better news:
- Rare Earths Buried in Confusion. That was the title of a recent article in the Australian about a rare earth conference with the opening paragraph stating that decisions are being made by rare earths companies based on information that is often “deliberately misleading, sometimes incorrect, incomplete or at times totally absent.” It was further added that published figures for rare earths prices should not be trusted as they may not be correct while Gareth Hatch of Illinois-based Technology Metals Research thinks the rare earth element dysprosium, which is used in magnets for everything from hybrid cars to wind turbines, could be in serious short supply in the coming years. Jon Hykawy of Toronto's Byron Capital Markets was also quoted as saying the lack of some specialty metals could produce catastrophic shocks to the global economy.
- Honda Comes Up With a Process to Recycle Rare Earth Materials from EV Batteries. Honda has apparently established the world’s first process to reuse rare earth metals extracted from nickel-metal hydride batteries in the creation of new nickel-metal hydride batteries. That’s good news for as electric car batteries have proven to be a “green” issue given how battery creation is an intensive process and then there is the question of how or what to do with the battery at the end of its life.
- NioCorp Developments Adds a Heavy Hitter to Its Advisory Board. NioCorp Developments Ltd, formerly known as Quantum Rare Earth Developments Corp, has not only just announced the name change but that they have recently added Mark A. Smith to the company's advisory board. That’s sort of significant as he was the CEO of and president of Chevron Mining, was involved in mining explorations in southeast Nebraska (where NioCorp Developments is active) in the 1970s and 1980s, recently served as CEO and Director of Molycorp and was recently involved in the world's largest niobium mine in Brazil. Smith should help NioCorp Developments find investors and help it to develop a $300 million mine proposed in southeast Nebraska.
- Rare Element Resources Reports Positive Drilling Results. Rare Element Resources, which is focused on exploration and development of rare earth elements plus controls the Sundance gold project, has announced that drill results continue to show its Bear Lodge Rare Earth Project located in northeastern Wyoming is a growing world-class source of critical rare earth element. Rare Element Resources executives added that assay results are now in from all of their development and exploration core holes drilled during the 2012 program.
- Great American Energy Announces Its 2013 Exploration Plan. Great American Energy, which as a portfolio of projects targeting lithium and rare earth element for America’s clean energy and clean tech industries, has announced 2013 exploration plan details for the Company's Phase I Bear Creek Rare Earth Project in British Columbia. Great American Energy says a further work program is warranted based on the property's potential mineralization with the program intended to better determine its resource and production potential.
So maybe investors still interested in the rare earth sector need to look beyond Molycorp’s problems and consider the whole picture or at least other investing options.