But if I was, you know, this would probably be the pick of what I’ve seen across the space. Yep, fair enough. All right. Move to our second stock. We’ll stay in the resource space. This one brought to us by Larry Arafura Rare Earths. The name says it all. And recently it’s got an offtake agreement with Siemens. Um, and I see that also it’s got a debt facility there with the German export Credit agency as well.
Luke Arafura The other positive point I saw was that Gina Rinehart’s Hancock owns 10%. That was interesting to me when I saw that. Yeah, um, look, these guys are obviously going through that tricky phase where you go from explorer to producer and it’s the hardest phase for a miner to go through. It’s almost, um, you know, no upside or downside because generally speaking, things only go wrong in the construction process when you’re trying to build out these mines, the best you can do is just get them to production on target and on budget. The markets already pricing that in. So realistically, you usually only miss expectations through this phase.
So production in 2025 means it’ll be a couple of years of this sort of in-between period before you see production. It’ll probably fluctuate on what rare earth prices are doing Um, so for investors, I think you’ve got one of two choices. You’ve had a good run as we see the chart there. Maybe you take some profits and look to re-enter a stock like this as they come into that production in a couple of years. Otherwise you’ve just got to be patient with it.
You know, from everything I’ve seen, it’s again, not really my space, but you’ve got a, you know Hancock Prospecting as a major shareholder offtake with Siemens. Everything you want to see for where the business is today is there. It’s just now about executing through to that production. And like I said, it’s always the toughest period for a miner. But you know, it looks like a good management team to be able to execute on it. So I would probably hold it if you’re there, but just be aware the next couple of years is that period where things can go wrong. Yeah. All right. Hold. But maybe take a look at taking some profit. Well, the share price had a good run. If you’ve been there for a few years, you’ve made good money on it. And you know, as I said, you’re now at that period where the exploration you’ve found out what’s in the ground, the market’s all excited about it. Now it’s a couple of years until you start to get it out and everyone sort of has to twiddle their thumbs and wait. So. Yep. Okay, great. Of course, this plays into the EV theme, the electrification, just more of those elements that are required.
Yes, absolutely. Well, we have a spec buy on it just because it’s not producing yet. So as Luke very well said, it’s a risky play just because it’s the hardest time to get into this stock and the hardest time for a miner to turn from an explorer to a miner and producer. Um, the other exciting thing, you guys did mention some of the offtake agreements, but they have some with Hyundai and Kia as well for the EVs. But the interesting thing about rare earths is that it’s not actually used in the batteries, it’s used in the motors. So there’s a lot of demand for that. And we did see some downside to the price of which is the key rare earth that these guys, mine and all rare earth companies mine is that neodymium. I’m going to leave that one to you because I can’t say it. NIO, Neodymium, and praseodymium.
