2024-07-23 00:50:44
Rajasik Mukherjee
(Reuters) – Lynas Rare Earth Corp LLY.N reported a fall in quarterly revenue on Tuesday, hurt by lower output at its Kalgoorlie plant in Western Australia and lower underlying prices, sending its shares to their lowest in more than three months.
The rare earths miner’s shares fell as much as 2.8 per cent to A$5.880, their lowest level since April 11.
Lynas’s Malaysian operations also experienced a maintenance shutdown during the reporting period, which the rare earths miner said lasted more than a month.
Total rare earth oxide production was 2,188 tonnes of REO in the fourth quarter ended June 30, down more than 50% from the same period last year.
“One of the kilns had a main bearing failure which required downtime for maintenance which took more than a month,” Lynas said of its Malaysian downstream operations.
Weak demand from green energy companies and electric vehicle makers, coupled with rising global supplies, has severely depressed prices for rare earth products.
“The rare earth market continues to be impacted by weakening Chinese demand and elevated supply chain inventories… no near-term support for prices is in sight,” Jefferies analysts wrote in a note.
Lynas said that although China’s domestic demand for end products has improved slightly, market prices remain low.
The company said the average selling price for the quarter was A$42.30 per kilogram, compared with A$43.50 per kilogram in the same period last year.
Earlier this month, Lynas said BHP’s ability to supply sulphuric acid – a key raw material for rare earth processing – to its Kalgoorlie plant was disrupted after BHP suspended its nickel operations in Western Australia.
Lynas said it had been in talks with the world’s largest mining company on contingency measures to ensure the continued supply of acid to the Kalgoorlie plant.
The world’s largest rare earths producer outside China posted sales revenue of A$136.6 million ($90.72 million) in the quarter, compared with A$157.5 million in the same period last year.
($1 = AUD1.5058)
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