By Colin Barr
October 28, 2010

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.

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