Molycorp Down 13% on Export Quota
Shares of Molycorp (NYSE: MCP) have been under pressure Wednesday, after China announced a higher-than-anticipated export quota for rare earth metals in 2012. Reports circulated that the Ministry of Commerce in China said it will not change its rare earth quota in 2012, for 10,546 tons.
The Ministry said that this quota will stabilize supplies for rare earth metals and guarantee demand. China represents 95% of the world's output for rare earth metals.
This puts pressure on rare earth stocks like Molycorp, Avalon Rare Metals (NYSE: AVL), and Rare Element Resources (NYSE: REE), just to name a few, as the increase in rare earth production will put pressure on prices, and in turn profit for these miners.
Currently shares of Molycorp are down about 13% at $24.34, shares of Avalon Rare Metals are down over 6% at $2.41, and shares of Rare Element Resources are trading about 10% at $3.26.
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