Rare Earths MMI®: Why the Molycorp, Inc. Bankruptcy Was Inevitable

Yesterday, the only US-based rare earths miner — Greenwood, Colo.-based Molycorp, Inc. — filed for chapter 11 bankruptcy protection as part of a reorganization of the company’s debt.

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This has been expected since Molycorp missed a debt payment early this month. In a statement, Molycorp President and CEO Geoff Bedford said, “The actions we have taken today are important steps toward achieving a restructuring of our $1.7 billion debt with our major creditor constituencies. In doing so, the company expects to exit Chapter 11 with an appropriate financing framework to support our business going forward.”


We have documented the long stock price slide Molycorp has experienced and how many manufacturers have simply found substitutions for the light rare earths they offer. As with any bankruptcy, Molycorp’s shares will be removed from the New York Stock Exchange and move to the OTC pink sheets.

While it’s difficult to say if Molycorp will be able to emerge as quickly as Bedford’s prediction, it will take recovery in the overall rare earths market for it to succeed. Our MetalMiner Indx has documented a steady slide in rare earths prices over the last two years.

What This Means for Rare Earths Buyers

China eliminating quotas and opening its rare earth products up to foreign markets is depressing prices overall. Right now rare earths are in surplus and less production or greater demand will be necessary to bring prices back to 2011 levels.

All Rare Earths Prices

Samarium oxide’s 5.9% decline made it this week’s biggest mover on the weekly Rare Earths MMI®, closing at CNY 16,000 ($2,581) per metric ton. Terbium metal saw a 2.1% decline over the past week to CNY 4,600 ($742.09) per kilogram. The price of dysprosium oxide fell 1.9% over the past week to CNY 1,520 ($245.21) per kilogram. This was the third week in a row of declining prices.

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Praseodymium neodymium oxide fell 1.8% over the past week to CNY 270,000 ($43,557) per metric ton. The price of neodymium oxide fell 1.8% over the past week to CNY 275,000 ($44,364) per metric ton. This was the fourth week in a row of declining prices. The price of neodymium oxide fell 1.8% over the past week to CNY 275,000 ($44,364) per metric ton. This was the fourth week in a row of declining prices. After a 1.3% decline, praseodymium oxide closed out the week at CNY 370,000 ($59,690) per metric ton.

At CNY 1,500 ($241.99) per kilogram, the price of europium oxide did not change since the previous week. At CNY 13,000 ($2,097) per metric ton, the week finished with no movement for lanthanum oxide. Neodymium remained essentially flat from the previous week at CNY 368,000 ($59,367) per metric ton. Closing at CNY 25,000 ($4,033) per metric ton, rare earth carbonate remained unchanged for the week.

Prices for terbium oxide remained constant, closing the week at CNY 3,500 ($564.63) per kilogram. Yttria traded sideways last week, hovering around CNY 33,000 ($5,324) per metric ton. Following a steady week, prices for yttrium closed flat at CNY 270.00 ($43.56) per kilogram.

Free Download: Latest Metal Price Trends in the June MMI Report

The Rare Earths MMI® collects and weights 14 global rare earth metal price points to provide a unique view into rare earth metal price trends. For more information on the Rare Earths MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

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