Dahlman Rose Raises Molycorp's PT to $85

China has recently decreased rare earth element export quotas, a development which Dahlman Rose believes should be supportive of the price of these materials. Further, Molycorp MCP has entered into several partnerships, which it believe create long-term value for shareholders. Dahlman believes that China is attempting to balance the need to export these raw materials, which are critical in numerous technology applications, with a desire to maintain adequate supplies for future domestic consumption. Further, we understand that China intends to reduce the amount of pollution generated by the REE industry, this should increase the cost structure of Chinese REE producers and further limit supply. The company has entered into JVs with Hitachi and Sumitomo. Dahlman believes that both partnerships create long-term value for shareholders. The JV with Hitachi will allow Molycorp to develop rare earth magnets in the US, helping the company complete its mine-to-magnets manufacturing supply chain. While the agreement with Sumitomo provides Molycorp with attractive financing and access to the wealth of mining expertise that Sumitomo has developed over many years. MCP is trading 8% higher at $54.17