Rare Earth Miners on the Watch: Lynas Share Price Sinks 7%

Highlights

  • Rare earths mining firm Lynas saw its September quarter production take a beating owing to COVID-19-induced shutdowns.
  • The coronavirus pandemic contributed to sales dipping to AU$121.6 million over the September quarter, compared to AU$185.9 million in the previous quarter.
  • CEO Amanda Lacaze said that production had to be shut for a period due to the unavailability of personnel due to COVID-19.

Lynas Rare Earths Ltd (ASX:LYC) shares fell more than 7% to a low of AU$6.87 in the early intraday trade on Friday after the company released its quarterly report for the period 30 September 2021. The Malaysian rare earths group reported that COVID-19-indcued shutdowns negatively impacted production during the quarter, which resulted in sales revenue and production falling significantly from the June quarter.

According to the company, the coronavirus pandemic contributed to sales dipping to AU$121.6 million over the September quarter, compared to AU$185.9 million in the previous quarter.

Lynas CEO Amanda Lacaze said that production had to be shut for a period due to the unavailability of personnel due to COVID-19.

Lynas CEO Amanda Lacaze said that production had to be shut for a period due to the unavailability of personnel due to COVID-19.

Image Source: ©Davidwatmough   | Megapixl.com

“The pandemic continued to affect logistics, with delays in both inbound and outbound shipments affecting availability of key production inputs and finished product deliveries,” said Lacaze.

Image Source: Lynas ASX update, 22 October 2021

Total rare earth production during the quarter stood at 3,166 tonnes, down from 3,778 tonnes in the June quarter, and NdPr production was 1,255 tonnes, down from 1,393 tonnes in the previous quarter.

“Demand, especially in the magnet market segment, continues to be very strong and our customers expect it to further accelerate in 2022,” said the company.

“Given that many market players expect the strong growth to continue, prices of Rare Earth materials used for magnets remain at a high level,” it noted.

Lynas said it has also submitted detailed engineering and design work for a US-based Heavy Rare Earths (HRE) facility, with the US Department of Defence evaluating its submission.

Meanwhile, Lynas shares were trading down 7.39% at AU$6.89 at 10:50 AM (AEST). The shares are up 155.7% over the past year and last closed at AU$7.44.

The company recently successfully completed a AU$425 million capital raise.

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