In this report we put forward the following thesis:
“The supply / demand dynamics of the global rare earth elements (‘REE’) industry are set to become imbalanced, owing to quasi-monopolist China curbing domestic production, and to the rapidly accelerating global adoption of renewable energy technologies that utilise REEs. We are of the opinion that the approaching market imbalance will ultimately be corrected by the fast-tracking into production of ex-China REE deposits. As such, we believe that investors should be positioning themselves for the impending recovery in the rare earth sector by investing in late stage REE projects that possess mineralisation geared towards renewable energy applications.”
Whilst the report analyses the global REE industry as a whole and does not examine the qualities and flaws of individual REE projects, the thesis of the report does justify our investment in Mkango Resources Ltd. We have recently increased our holding to just shy of 5% of the company’s issued share capital.