What’s the Demand Like? Demand for rare earths is expected to hit 200,000 tons, valued at around $2 to $3 billion, by 2014, with 25% of new demand coming from technological advances. In China, demand of rare earths is forecast to outstrip supply by 2012. [Van Eck Launches First Minor Metals ETF.]
The Market Vectors Rare Earth/Strategic Metals ETF (NYSEArca: REMX) is a relatively new ETF that holds stock of minor metal producers, while Global X Lithium (NYSEArca: LIT) gives exposure to lithium producers.
The Bottom Line. Rare earths are an interesting and unique market, and once again, ETFs have stepped up to give ordinary and professional investors alike access to it. There’s certainly a case to be made for rare earths, considering the growth of new technologies. Market Vectors’ and Global X’s ETFs are easy ways to get exposure to the producers while giving you an alternative way to play the growth of industries that widely use the elements.
Max Chen contributed to this article.