Arafura Resources (ASX: ARU) has reported that one kilogram of Nolans rare earths mix has increased in value to US$86.26, representing a 10% increase since January 2011, and is 2.5 times the 2010 average.
The new prices for rare earths quoted by Metal Pages have moved upwards again since China announced further reductions in rare earth export quotas in allocations for the first half of 2011.
Prices of all rare earths have increased in response to the new quotas, in particular cerium, neodymium and praseodymium oxides.
Importantly, Arafura recently announced it had successfully separated these rare earths as part of its ongoing technology program.
Dr Steve Ward, Arafura’s Managing Director and CEO, said, “this trend is further demonstration of the very positive outlook for global rare earth markets."
"We are entering a new era for the rare earths industry as a very small number of suppliers from outside of China emerge in the short to medium term."
Arafura is making solid progress towards its plan for first production in 2013 at its wholly-owned Nolans Bore Rare Earths deposit.
The company plans to exploit Nolans Bore to produce rare earth oxides for worldwide markets and is well positioned to capitalise on favourable future market conditions.
At current prices, Arafura's annual sales revenue from rare earths alone will be US$1.7 billion.
The company believes that future pricing "will reflect the tight ongoing market supply/demand dynamics, and recognise the criticality of rare earths to end applications for relatively modest input cost.”
On February 14 Arafura said it will undertake a major drilling program at Nolans to upgrade resources as part of the Nolans Bore Bankable Feasibility Study.