In 2010, China, the world’s largest producer of rare earths minerals, cut back exports as part of a political dispute with Japan, pushing up prices on rare earths by 40% from the preceding year and raising concern over supply. The announcement helped push up Molycorp and other producers to new highs in the following year. [Supply Risk No Longer Supporting Rare Earth ETF]
Molycorp said Wednesday “that it has executed a restructuring support agreement with creditors that hold over 70% of the aggregate principal amount of the Company’s 10% senior secured notes. The agreement provides for a financial restructuring of the Company’s $1.7 billion in debt and provides up to $225 million in gross proceeds in new financing to support operations while the Company completes negotiations with creditors.”
The U.S. is the third-largest country weight in REMX at 15.7% of the ETF’s weight. China and Australia are the ETF’s largest country exposures at weights of 19.9% and 17%, respectively.
Market Vectors Rare Earth/Strategic Metals ETF