The Lynas Rare Earths Ltd (ASX: LYC) share price is soaring today.
Shares in the S&P/ASX 200 Index (ASX: XJO) rare earths miner closed yesterday trading for $6.80. In earlier trade on Friday, shares were swapping hands for $7.23 apiece, up 6.3%.
After some likely profit-taking, shares are trading for $7.10 at the time of writing, seeing the Lynas share price up 4.4% as we head into the lunch hour.
For some context, the ASX 200 is up 0.1% at this same time.
Here's what's happening.
Tailwinds blowing in from China's export ban
The Lynas share price looks to be enjoying a strong boost today with a nod of thanks to a new export ban from the middle kingdom.
As you likely know, China has a virtual monopoly on rare earths processing. These are the 17 metals vital for the development of high-tech items like EVs, electronics, and numerous military applications.
And yesterday China moved to safeguard that monopoly by banning the export of the technology required to process rare earths.
"This should be a clarion call that dependence on China in any part of the value chain is not sustainable," Nathan Picarsic, co-founder of Horizon Advisory said (quoted by Reuters).
That looks to be offering a lift to the Lynas share price today as the ASX 200 miner is the only significant producer of scale of separated rare earths outside of China.
The company owns the Mt Weld mine, in Western Australia, encompassing one the world's highest grade rare earths mines. Lynas also owns and operates the Mt Weld Concentration Plant, as well as a manufacturing facility in Kuantan, Malaysia, Lynas Malaysia.
Lynas Malaysia separates and processes rare earth materials sourced from Mt Weld. The plant commenced production in 2012 but recently faced legal headwinds over environmental concerns from the Malaysian government.
Those concerns were put to rest in October when Malaysia granted the miner a variation to its operating licence to continue importing and processing lanthanide concentrate sourced from Mt Weld.
These facts haven't been lost on Bell Potter.
The broker recently came out with a bullish assessment for the outlook of the Lynas share price, with an 'add' rating on the stock.
According to Bell Potter:
Lynas is the highest quality source of ex-China rare earth supply, with a trajectory towards doubling capacity over the next three years via the expansion of their mining and concentrating capacity at Mt Weld.
Bell Potter has an $8.80 price target for the Lynas share price.
Even after today's boost, that represents a potential 24% upside for the ASX 200 rare earths miner.
