China’s threat to weaponize rare earth metals

In China Could Use Rare Earth Exports as Ammo against US Tech, we discussed how China is planning to use its rare earth minerals as a weapon against the US in the ongoing trade war. Rare earth minerals are a group of 17 chemical elements that have wide applications from technology to military equipment. China produces about 95% of the world’s rare earth minerals and thus has a dominant position as a rare earth producer. The US depends on China for as much as 80% of its imports.

What’s behind Plunge in China’s Rare Earth Exports in May?

China’s rare earth exports shrink in May

In another indication that China (FXI) could be taking rare earth export control seriously, its rare earth exports slumped by 16% month-over-month and 18.2% year-over-year to 3,640 tons in May. This is also the second consecutive month of negative export growth for the minerals.

Independent rare earth analyst Wu Chenhui told Global Times that the decline in May might have more to do with China’s crackdown on illegal rare earth extraction rather than the US-China trade war. He, however, predicts that the impact of China’s intention to curb exports might manifest in the trade data over the next few months.

Rare earth stocks

The VanEck Vectors Rare Earth/Strategic Metals ETF (REMX) provides exposure to companies involved in rare earth mining. This ETF has been rising due to China’s threats. Tronox Holdings (TROX) is the only US-listed company in REMX’s top 20 holdings. The Rare Element Resource (REEMF), a US-based company that explores for mineral properties, has skyrocketed by 467% year-to-date due to China’s threats.

Latest articles

This year, Pfizer (PFE) stock has fallen 0.34% and Bristol-Myers Squibb (BMY) stock has fallen 6.48%. Both companies are focused on strengthening their position in the high-growth oncology and immunology markets. Let's take a closer look at each.

Walt Disney’s (DIS) latest movie, Toy Story 4, has reportedly broken records in the opening weekend with $118 million in sales. However, the opening weekend collection was behind analysts’ expectations of at least $150 million in the first weekend.

24 Jun

Will Home Depot’s Upward Momentum to Continue?

WRITTEN BY Rajiv Nanjapla

As of June 21, Home Depot (HD) was trading at $209.39, which implies a rise of 9.7% since the announcement of its first-quarter earnings on May 21. Also, the company was trading at a premium of 32.4% from its 52-week low of $158.09 and a discount of 2.8% from its 52-week high of $215.43.

On June 21, Aurora Cannabis (ACB) made an announcement that indicated that it will move towards higher margin vape products. In addition, the company also believes concentrates and edibles will command higher margins. In anticipation of this development, the company announced the expansion of its facility to capitalize on growth related to these segments.

Shares of Mondelēz International (MDLZ) are scaling new heights thanks to its stellar gains so far this year. Mondelēz stock is up 38.0% on a YTD (year-to-date) basis, and it closed at $55.25—just a shade lower than its 52-week high of $55.71—on June 21.

24 Jun

How Long Will Facebook's Libra Fuel Bitcoin Rally?

WRITTEN BY Mayur Sontakke, CFA, FRM

Ever since the news about Facebook’s (FB) cryptocurrency project broke, Bitcoin has rallied on the hope that Facebook’s entry in the space will help make cryptocurrencies mainstream. Facebook’s cryptocurrency will be called Libra and will be governed by an association with 28 founding members across industries.