China's AMI Pricing Strategy Slashes Dysprosium Prices Over 90%, Hurting Nouveau Monde Graphite
China's rare earth pricing benchmark AMI lets Beijing crash global prices whenever Western projects, including Nouveau Monde Graphite, gain traction, triggering investment failures. Dysprosium oxide prices surged from $90/kg in 2009 to over $2,300/kg by 2011 then plunged below $200/kg by 2016, bankrupting U.S. ventures.
1. Beijing's Rare Earth Pricing Strategy
Beijing leverages the Asian Metal Index (AMI) as a global benchmark to control rare earth prices, flooding markets with cheap material whenever Western processing capabilities advance to undermine competitors. This approach ensures China can reset prices at strategically low levels, eroding the economics of any independent project.
2. Historical Price Volatility and Western Project Failures
In 2010 a supply halt to Japan drove dysprosium oxide from $90/kg to over $2,300/kg by mid-2011, sparking a boom in Western mining and processing ventures. Once prices peaked, China reintroduced ample supply, crashing prices below $200/kg by 2016 and bankrupting firms such as Molycorp.
3. Implications for Nouveau Monde Graphite
The recurring cycle of price spikes followed by steep declines has deterred investors and drained capital from Western rare earth initiatives, posing a significant challenge to Nouveau Monde Graphite’s ability to secure funding. Continued dependence on market pricing undercuts project viability unless new policy or commercial safeguards emerge.