London August 25, 2010. The Premier League.

"Throughout the recent economic calamity, and over the course of elections that have changed governments across the continent, Europe’s shift away from fossil fuels has not slowed."

If China is going to start building and selling a million electric vehicles a year, as has been reported as part of their latest economic plan, in a command economy when the top says build them and sell them, they get built and sold no matter what, then it’s pretty obvious that China is going to implement its rare metals export ban in 2015. We have just 4 1/3rd years to be ready elsewhere to meet the rest of the world’s demand. As I have been trying to show last week and this, new technology breakthroughs are about to double, triple, the double again, demand for these rare metals by the time of the Chinese export ban.

To this old trader that means front weighting investment into those who can meet a 2015 deadline, by that I mean, actually have their resource in production and refined into the product that manufacturers need, and at a sales cost that makes the company a profit. The sole purpose of any investment is to buy low and sell high, since it is highly unlikely that any of the rare earth firms will be paying out dividends in the next few years, if at all. As such that time compression, for me, rules out most firms in the remote wilderness, seeking to get into the game late. The exceptions are perhaps Ucore Rare Metals, Hudson Resources, and Quest which has picked up interest and help from SIDEX in Quebec.

My market experience suggests that we will quickly form a Premier League and a Division Two, where the companies are possible later takeover targets by the companies in the Premier League and possibly China, if China’s companies decide to take that route and are permitted into the game. I know, it’s not a level playing field world. So who get into Graeme’s Premier League?

Great Western Minerals Group, Lynas Corporation, Tasman Metals Ltd, Avalon Rare Metals, Molycorp Minerals, Alkane Resources are the only true Premier League candidates, though I will allow in Ucore, Hudson and Quest. To be sure all have some pluses and minuses. For example, will the Aussie candidates have a disadvantage due to a mining tax and a hung Parliament unable to function well? Will California’s politicians really keep out of Molycorp’s way, as the state goes from broke to ruined? Can Quest and Hudson really catch up with the others by 2015? There is one other company I think ought to be in. Stans Energy Corp is my final pick for the starting Premier 10. The positive is that their mine and region produced and refined once before for the old unloved Soviet Union. The negative is that is in the Kyrgyz Republic, better known to us as Krygyzstan. How will Graeme’s Premier 10 do? Maybe some kind soul will post a table, and start them all off using Friday’s settlement price. Suggestions please on whether it should be equal share weighted, or equal cost weighted. Suggestions please on additions or for filling up the other divisions.

More tomorrow, after I take an evening libation and a nap.

Graeme Irvine. London.