TORONTO, Nov. 10, 2014 /PRNewswire/ -- Rare earths engineering consultants TRU Group Inc says China-controlled pricing is self-destructive and creates hurdles for western RE metal projects.
Average rare earth prices have levelled off at an estimated $18,500 per t for 2014 following the steep declines in recent years. Prices have stabilized at a level below the average for 2010 before the crisis in supply began when China unexpectedly restricted exports. (See REE price chart on our website). "The failed attempts by Chinese suppliers to halt the decline in REE prices was long predicted by TRU," say CEO Edward R Anderson.
"Rare earth metal prices are so low now that profit margins even in China may be unattractive". Strategic rare earths* are used in high-tech magnets for electric vehicles and China produces over ninety per cent of global requirements. Most western REE newcomers have exhausted their cash and have been forced into hibernation: They need more sensible operational business models to attract investors. "Trouble is that the REE juniors focus too much on geology when the real technical issues lie in highly specialized REE chemical production. Design of operations in a fragmented industry is complex but crucial to success. Unless there is a strategic change in direction I doubt whether we will see the capacity expansion that was expected," says Anderson.
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* TRU segments REEs into strategic, tactical and commodity products.
TRU Group Inc (trugroup.com) - is a world leader in rare earth element engineering, managing, planning and integrating. The TRU Rare Earth Team has direct hands-on experience in designing, engineering and operating REE facilities. The firm has undertaken feasibility studies and due diligence on major REE projects from resource through, mineral processing / dressing, RE chemical extraction, oxalate separation and metal refining. TRU Rare Earth Team has technically and financially simulated numerous rare earth engineering options and indeed studied and ranked over seventy of the most advanced rare earth pipeline projects. For more information visit our - Rare Earth Elements & Consultancy Page - http://trugroup.com/tru-rare-earth-elements
SOURCE TRU Group Inc