Investors took a set against rare earths miner Lynas yesterday after it released its third quarter report revealing a slide in sales because of problems shipping its products.
The company’s shares dropped 8.3 per cent to $5.83, the lowest they have been in a month.
Lynas revealed sales revenue was down quarter on quarter from $119.4 million to $110 million, but were up from the $91.2 million registered in the first three months of 2020.
Sales and cash receipts were higher as average selling prices jumped 20%, from $29.50 to $35.50 a kilo even as sales volumes slumped from 4,601 tonnes to 3,096 tonnes due to pandemic-induced logistics issues.
Lynas said it struggled to secure shipments during the March quarter due to lower ship availability caused by both the pandemic and the Suez Canal blockage.
That was seen as a short-term blip by the company which told the market that the market for rare earths was performing well, despite the latest COVID outbreaks ravaging key markets like Europe.
It reported record selling prices for Neodymium and Praseodymium (NdPr) and mixed heavy rare earths (SEG) for the March quarter.
Lynas mines and processes the 17 rare earth elements crucial to the manufacture of many hi-tech products such as mobile phones, electric cars and wind turbines, said it continues to hold a cautiously optimistic view of the market.
“The rare earths market appears to be recovering well, with both magnet and catalyst sectors experiencing robust demand during the quarter.
“The Lynas share price has traded at record highs recently as the underlying macro-economic fundamentals of rising electric vehicles demand, green energy solutions such as wind power, consumer electronics and automation underpin the favourable prices the company is getting for its ores,” the company said in the report.
