Lynas (negative impact) released its activity report for the March quarter. Pricing for NdPr continued its upward trajectory over the quarter with favourable prices achieved.
The company’s Malaysia plant continues to operate at 75% of capacity as intended. However, sales were significantly below production levels as the company encountered shipment and logistic delays given bottlenecks seen in shipping (including the Suez Canal blockage).
The company also noted a major Chinese competitor is expected to significantly increase its production over the next 3 years. While this may impact pricing in the near term, Lynas’ assets remain highly important strategic assets (one of two large rare earth producers outside of China), which should result in robust pricing over the longer term.
MMA Offshore (neutral impact) has announced a memorandum of understanding with Worley to provide maintenance support for the offshore wind market in Taiwan and the Asia Pacific.
Under the agreement, Worley will provide turnkey operations and maintenance services while MMA will provide subsea and vessel services.
The collaboration provides another example of how both companies are pivoting towards the renewable energy market.
Origin Energy (negative impact) announced an unfavourable outcome to a gas supply price dispute. The decision will increase Origin’s gas supply costs over the next 2 years.
As a result of this and further weakness in wholesale electricity pricing and demand, the company expects its operating earnings to be 8.5% (at the mid-point) below its previous guidance.
We continue to see Origin as a long-term investment and a company that is well-positioned to play a broader role in the energy transition over the coming years.
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