Medallion Resources: A Unique Approach To Rare Earths
Don Lay, president and CEO of Medallion Resources, discusses his company's unique approach to the rare earths market — processing monazite — also touching on what monazite is and why he believes so strongly in it.
As the rare earths market looks to settle following this summer's WTO ruling on China, focus is shifting to companies looking to produce rare earths outside that nation. Rare Earth Investing News (REIN) recently had the chance to speak with Don Lay, president and CEO of Medallion Resources (TSXV: MDL,OTCQX:MLLOF), a company that is looking to do exactly that. In the interview below he explains Medallion's unique approach to the rare earths market — processing monazite — also touching on what monazite is and why he believes so strongly in it. REIN: Even though some rare earths, such as neodymium, have seen stronger prices this year, the rare earths market has been less than stellar overall. How has that affected Medallion Resources' approach?DL: Our economics are very robust at today's rare earths prices, so the biggest effect has been that investor interest in the sector has waned somewhat as prices went down from their peak. But there is still significant interest in the sector because of its importance in high-tech electronics, military applications and energy-saving applications and the like. None of that has gone away and the uses are increasing. All in all, the decline of rare earths, the pricing of it, hasn't really affected us that much directly because our proposed operation is expected to be very profitable even at current pricing. REIN: Do you have a long-term prediction for the rare earths market?DL: I think it's found a bit of a balance here. A balance between cost of production in China — which has increased given Chinese government controls — and China's desire to keep a significant amount of its rare earths production. There's still a lot of supply in China, and although some of it is illegal, costs are increasing because the government is clamping down on production; it's also forcing environmental controls, which China never followed before. Generally there's growing demand for rare earths and supplies are becoming available outside of China. The two dominant suppliers are Molycorp (NYSE:MCP) and Lynas (ASX:LYC), which are now getting into significant production of rare earths.