The Balance Problem: The Economics of Mining

Nature’s Bundle

You cannot mine just Neodymium. It comes mixed with Cerium and Lanthanum. In a typical mine, for every 1 kg of valuable Neodymium you produce, you might be forced to produce 4 kg of cheap Cerium.

The Surplus Trap

Because demand for magnets (Nd, Pr) is skyrocketing, miners ramp up production. But this floods the market with Cerium and Lanthanum, crashing their prices. This is the “Balance Problem.” A mine might be profitable on paper based on its “Basket Price,” but if it can’t sell 70% of its volume (the Cerium), the economics fail.

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