Rare-Earths For Dummies (MCP, SHZ, REE, AVL)

It seems like you can't turn on the TV or visit a financial website without hearing about the necessity of rare-earth minerals. But while everyone is aware of them, very few know what they are, why they're important, and why shares of these companies are skyrocketing on a daily basis. In this article, Benzinga has compiled a list of news and stock information to help clear up the confusion. Last week, China reduced its

for these peculiar minerals, causing great concern among electronics, automobile, and green technology manufacturers. The reasons why have more to do with the supply chain than the availability of rare-earth minerals, which are

. The United States currently imports 87% of its rare-earth mineral needs from China, despite having some

. China, meanwhile, supplies more than 95% of the global market. Not surprisingly, Chinese export quotas have now become headline news. Without rare-earth minerals, Apple

iPods and iPhones could not be manufactured; Toyota

cars would lose their hybrid batteries; General Electric

couldn't produce any wind turbines; and General Dynamics

wouldn't have any engines to fire up its F-16s. These are just a few of the many different products that require this hot commodity. If it weren't for Molycorp, Inc.

, a U.S.-based company that owns a facility in

, this might have been the time to panic. Though the facility may not go online

, Molycorp has gained a lot of attention as the largest domestic rare-earth miner. Analysts

and

have taken notice of the firm's market position, adjusting their respective price targets accordingly. Molycorp has been surging since September 2010, at which point the company's government-regulated “quiet period”

. At that time, Molycorp was trading at $22. Today, Molycorp is trading at roughly $60 per share. Molycorp isn't the only company benefiting from the need – and potential shortage – for rare-earth minerals. China Shen Zhou Mining & Resources Inc.

is trading up roughly 19% today. After an early afternoon surge of nearly 2%, Lynas Corp. Ltd.

is trading closer to yesterday's close of $2.27. On the other hand, Market Vectors Rare Earth/Strategic Metals ETF

is trading down 3%. Rare Element Resources Ltd.

is trading down roughly 5%, and Avalon Rare Metals Inc.

is trading down more than 6%. As the need for rare-earth minerals increases, these stocks are expected to perform well. But they are not impervious to market fluctuations. In fact, just this morning, Benzinga reported on a

that suggested the stocks could be due for a sell-off.