Maybe the rare earths aren’t as rare as we thought.
Shares of the rare earth stocks, notably Vancouver-based trader Rare Element Resources and Colorado’s Molycorp , plunged Thursday after the New York Times reported China had resumed shipments of rare earth elements.
Shares of the Van Eck Market Vectors Rare Earth Strategic Metals exchange-traded fund dropped 1% in their debut, reversing the morning’s 2% gain.
Molycorp, which is poised to become the lone U.S.-based rare earths miner, had tripled since its July debut but saw its shares tumble 11% to $34. Rare Element, which has seen its shares rise tenfold from $1 and change, slid 12% to $11.18.
Stocks of the rare earth element producers soared this summer amid questions about China’s plans for exporting the minerals, of which it currently controls some 97% of global production. But as with so many assets at a time of free money, that rally fed concerns that the rare earth stocks were in a bubble.
A few more days like Thursday and at least we won’t have to worry about that anymore.