ASX, energy, metals and mining shares have underperformed the broad indices today, with investors winding back exposure following a period of strong gains.
The S&P/ASX 300 Metals and Mining Index (ASX: XMM) is down 2.26% at the time of writing, while the benchmark S&P/ASX 200 Index (ASX: XJO) has slipped 1.3%.
The Lynas Rare Earths Ltd (ASX: LYC) share price is no exception and is currently down 4.4%, now trading at $7.87 apiece despite no news.
What's up with the Lynas share price?
Losses have extended into today's session for Lynas from the broad selling pressure mentioned above, but also what appears a continuation of a downtrend that started on Tuesday.
Chief to the downside was a company announcement detailing disruptions to the water supply of one of its sites in Malaysia.
Lynas advised that between July and August 2022, water supply from the Malaysian local supplier was "unpredictable and on most days below the level required to run all 4 kilns".
The rare earths player had employed a number of tactics to mitigate the uncertainty, namely sourcing alternative water sources and trucking external water in.
The ASX mineral explorer initially expected the supply disruption to resolve and normal water supply resume during September.
If true, this "would have enabled the shortfall from July and August to be mitigated," it said. However:
Following a catastrophic equipment failure in early September, PAIP has not supplied any water
for seven days.This issue is affecting all users in the Kuantan area, including residential customers… PAIP has now provided an update that the current situation of zero supply is expected to continue for at least the next week.
As a result of the disruption, Lynas estimates the water supply from PAIP will remain uncertain and unpredictable until the end of this month.
"Whilst Lynas' alternative strategies will support some continued production during September, it will fall short of the level achieved in July and August 2022," the company said.
After a choppy year on the chart, the Lynas share price is down 22.6% this year to date, having sunk another 20% this past month.
In the past 12 months, Lynas shares have clipped a 1.3% gain.
