China’s 7,000% Rare Earth Christmas Coup

While U.S. voters and politicians continue to bicker and politicize everything under the sun, China is once again running the chessboard exerting its dominance in one of the most critical sectors in the investment landscape: the rare earth space.

China recently announced (I like the Christmas season news release while no one pays attention) that it is merging several important rare earth producers to create a rare earths giant. 

The three companies — China Minmetals Corp., Aluminum Corp. of China, and Ganzhou Rare Earth Group Co — will now be called China Rare-Earths Group. Catchy right? 

It’s goal is to speed the development of mines in the south, not hinder or delay like in so many places around the world right now. 

The merger of producers is part of China’s plan to create two mining juggernauts — one in the north and one in the south. 

For those not familiar with rare earths, they are essential metals necessary to make everything from smartphones, electric vehicles, and satellites… to fighter jets, nuclear reactors, and technologies the military would rather you and I not know about.

The timing isn’t exactly a surprise as rare earth prices have surged 88% this year.

Once upon a time, in the 1980s, the United States was the world’s largest producer of rare earths. It took but a few decades for China to gain a stranglehold on production, and it now accounts for 60% of global production.

Whether it’s rare earths, uranium or lithium, there needs to be more urgency from both private and public groups to establish the infrastructure necessary for a more metal-independent future.

There are hints of that starting to happen but there needs to be more coordination and less red tape if the U.S. and other regions of the world are going to compete for a seat at the green revolution table. 

Whether it’s lithium, uranium, or rare earths… My new trading system is designed to profit from the coming scramble to secure these critical metals.

Throw in irresponsible and unsustainable fiscal and monetary policy, jurisdictional risk increasing, and less supply than forecasted demand… and I believe we have the perfect setup for another commodity supercycle.

I made over 7,000% on a single trade the last time rare earth prices surged. And I think this new cycle is one that will keep on giving. 

Enjoy the holidays everyone. And get ready for a phenomenal 2022. 

Let's get it,

Gerardo Del Real
Editor, Resource Stock Digest