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Rare-earth stocks outside China have been heating up with particular force since China's announcement in late December that it would cap rare-earth exports by 35% in the first half of 2011 versus the same time last year. More than 95% of the world's rare-earth minerals supply comes from China. According to the Wall Street Journal, the surging costs of rare-earth materials from China's export restrictions is putting pressure on U.S. oil refiners; certain rare-earth materials such as lanthanum and cerium are used in the refining process. Lynas said prices for these two materials have more than tripled between the second and third quarters of 2010, according the WSJ, which also reports that the price increase comes as refiners such as Valero Energy ( VLO) and Sunoco ( SUN) finally see operating improvement and begin to realize the benefits of selling off their weaker assets.
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