Introduction
There is a group of metals that consists of the 15 elements of the lanthanide series. List of 15 elements such as: lanthanum (La), cerium (Ce), praseodymium (Pr), neodymium (Nd), promethium (Pm), samarium (Sm), europium (Eu), gadolinium (Gd), terbium (Tb), dysprosium (Dy), holmium (Ho), erbium (Er), thulium (Tm), ytterbium (Yb), and lutetium (Lu). In addition, yttrium (Y) and scandium (Sc) are referred to as REE. Lynas Rare Earths Limited (ASX: LYC) is an integrated source of rare earths from mine to customer. Lynas has a portfolio of aligned assets to explore, develop, mine and process rare earth minerals. Technological advancement has given the rare earth elements rising importance in many domestic, medical, industrial, and strategic applications due to their unique catalytic, metallurgical, nuclear, electrical, magnetic, and luminescent properties. There are various applications for rare earth elements, including their use in magnets and super magnets, motors, metal alloys, electronic and computing equipment, batteries, catalytic converters, petroleum refining, medical imaging, coloring agents in glass and ceramics, phosphors, lasers, and special glass. Australian production of rare earths in 2018 was almost 0.019 Mt, mainly contributed by Lynas Corporation’s Mount Weld mine in Western Australia. 2.6 t of rare earth carbonate was produced and exported to China by Northern Minerals Limited. According to estimates published by the United States Geological Survey and modified by Geoscience Australia for Australian resources, world economic resources of rare earths in 2018 totaled 120 000 kt of rare earth oxide(REO). World production of rare earths, based on USGS data and modified for Australian production, was estimated to be 170 000 t of REO in 2018. Australia was the global second-largest producer contribution of Lynas Corporation’s Mount Weld mine in Western Australia.
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Investing in ASX Rare Earths Shares?
Australia was the second largest producer of rare earth elements in the world as reported by Geoscience Australia. Rare earth elements prices are hard to come by as there is no widely public exchange. Spot prices are listed on internet websites, for example, Kitco and Metals prices, though they are infrequently traded and pricing should be approached with skepticism.
Exposure to rare earth elements (REE) can also provide diversification benefits for the portfolio. For instance, while the prices of most stocks have been fluctuating faster since the onset of the Russia-Ukraine war, the prices of many resource stocks, specifically those producing rare earth metals, have gone up higher on the back of skyrocketing commodity prices during 2021. Post-2022, the rare earth prices have started with a heavy correction, and the ASX rare earth shares have also moved faster on the downside from their all-time high. Investment at a fair price for rare earth shares will be beneficial in the long run when the price starts to shoot up again in the future.
What are ASX Rare Earths Shares?
There are Australian rare earth element producing companies listed in the Australian stock exchange are called ASX rare earth shares, where traders buy and sell these ASX rare earth metals shares. There are large cap to mid-cap and small level companies proactively involve in the exploration and mining activities in Australia. Some good ASX rare earth companies that are ASX rare earth shares from higher market cap to lower market cap (dated as of 17 August 2023) are as follows:
• Lynas Rare EARTHS Ltd. (ASX: LYC); market cap of $6.31B.
• Iluka Resources Ltd (ASX: ILU); market cap of $3.98B.
• Alpha Hpa Ltd (ASX: A4N); market cap of $1.01B.
• Arafura Rare EARTHS Ltd (ASX: ARU); market cap of $496.64.
• Alkane Resources Ltd (ASX: ALK); market cap of $375.98M.
Top Rare Earths Stocks on the ASX: 3 Biggest Companies in 2023
Demand for critical minerals is growing, and simultaneously, inflation has created a big barrier to rising production costs, particularly as legacy assets are drying up. These factors are driving serious deal-making, including most recently BHP Group Limted’s takeover of copper producer Oz Minerals and Newmont’s bid for Newcrest. The top 3 stocks to consider for the biggest rare earth companies in 2023 are as follows:
Lynas Rare EARTHS Limited. (ASX: LYC)
Lynas Rare Earths Ltd. (ASX: LYC) has a market cap of $6.31 billion and a current price of $6.75 (as of August 17, 2023). It is a viable source of rare earths from mine to customer. Lynas has a portfolio of aligned assets to explore, develop, mine, and process rare earth minerals. These assets are Mt. Weld and Lynas Advanced Materials Plant. LYC's main asset is the Mt. Weld rare earth deposit, situated in Western Australia.
The Mt. Weld expansion project is progressing as planned, with earthworks nearing completion and the early concrete works well advanced. Fabricated steel modules are being delivered to the site in preparation for contractor mobilization.
Iluka Resources Ltd (ASX: ILU)
Iluka Resources Ltd. (ASX: ILU) has a market cap of $3.98 billion and a current market price of $9.37 (as of August 17, 2023). It is a global critical minerals company with experts in exploration, project development, mining, processing, and marketing. The company's goal is to deliver sustainable value. Iluka Resources Limited is a leading producer of zircon and high quality titanium feedstocks. Through the company's development of Australia's first fully integrated rare earths refinery at Eneabba in Western Australia, Iluka is set to become a global material supplier of separated rare earth oxides. Iluka's products are used in an array of applications, including technology, construction, medical, lifestyle, defense, and industrial uses.
Alpha Hpa Limited (ASX: A4N)
Alpha Hpa Ltd. (ASX: A4N), which has a market cap of $1.01 billion and a current market price of $1.15 (as of August 17, 2023), is engaged in proceeding with the commercialization of its proprietary solvent extraction and refining technology to produce HPA for sale in the lithium ion battery and LED battery markets. Alpha secures the exclusivity of the process IP License for the production of all aluminum bearing products, extinguishing the Licensor’s previous potential future right to issue a second commercial License.
Alpha’s global marketing effort has continued to gather momentum with a series of positive qualification test results and a number of significant global brands, particularly in the lithium-ion (Li-ion) battery cathode sector, now working with the Company on expanded test work on Alpha’s materials as cathode dopants. Inbound inquiries on the Company’s high-purity alumina tri-hydrate (ATH) and high-purity nano aluminas have also expanded.
Pros and Cons of Investing in Rare Earths Shares?
The investors will get a diversification benefit. The price of rare earth metals does not move in lockstep with traditional investment asset classes such as stocks and bonds. This makes it a favourable asset to add to a portfolio for risk minimization through diversification. The other pros are shortfalls and high demand. When demand meets the shortfall, rare earth element stocks start to deliver an attractive return.
On the negative side of it, the rare earth markets are sometimes highly illiquid and thus create volatility too. These commodities are mysteriously controlled by big and secretive mining firms. When supply or demand disruptions happen, small retail investors are the most affected.
Investing in rare earth shares might pose a political risk. Finally, if the United States or any other nation develops cheaper and better alternatives to certain rare earth metals, demand may diminish, which will create a logjam in portfolio growth.
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Frequently Asked Questions (FAQ)
What Are Rare Earths?
The rare earth elements are a set of lustrous, silvery-white, soft heavy metals. List of 15 rare earth elements such as: lanthanum (La), cerium (Ce), praseodymium (Pr), neodymium (Nd), promethium (Pm), samarium (Sm), europium (Eu), gadolinium (Gd), terbium (Tb), dysprosium (Dy), holmium (Ho), erbium (Er), thulium (Tm), ytterbium (Yb), and lutetium (Lu). In addition, yttrium (Y) and scandium (Sc) are referred to as rare earth element (REE).
What are best Rare Earths stocks?
Australian rare earth metal producing companies that are basically rare earth stocks provide buying opportunities when there is massive demand for the relevant metals arises, and hence REE prices also rise. Some of the best billion- and million-dollar rare earth stocks by market cap are as follows: Lynas Rare EARTHS Ltd. (ASX: LYC); market cap of $6.31B.Iluka Resources Ltd (ASX: ILU); market cap of $3.98B.Alpha Hpa Ltd (ASX: A4N); market cap of $1.01B.
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What is the best rare earth stock on the ASX?
Lynas Rare Earths Limited (ASX: LYC) is a critical source of rare earths from mine to customer. Lynas has a portfolio of aligned assets to explore, develop, mine, and process rare earth minerals.
What is the best rare earth stock to buy?
Iluka Resources Ltd. (ASX: ILU) has a market cap of $3.98 billion and a current market price of $9.37 (as of August 17, 2023). It is a global critical minerals company with experts in exploration, project development, mining, processing, and marketing that provides the best long-term buying opportunity for investors.
What is the rare earth metal company in Australia?
There are Australian rare earth element producing companies listed on the Australian stock exchange, which are called ASX rare earth shares. Investors take a call on trades dealing with these ASX rare earth metals shares. There can be large-cap to mid-cap and small-level companies participating in the exploration and mining activities in Australia. Alkane Resources Ltd (ASX: ALK) is the Australian rare earth company.
Who buys Vanguard ETF?
Sterling Manor Financial, LLC buys First Trust Consumer Staples AlphaDEX Fund, FIRST TR EXCH; WT Wealth Management buys Vanguard U.S. Value Factor ETF; VanEck Rare Earth/Strategic Metals Energy Opportunities Capital Management, LLC, buys the VanEck Rare Earth/Strategic Metals ETF.
Does Lynas Rare Earths Limited's rare earth pay dividends?
Lynas Rare Earths Ltd. (ASX: LYC) has a market cap of $6.31 billion and does not have a dividend history. The stock price has fallen by 34% in 1 year (YTD until August 17, 2023) with a PE ratio of 11.42.
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