November 18, 2011 - 'Tasman – Cormark Securities Commences Analyst Coverage of Tasman Metals '
November 18, 2011
TASMAN METALS LTD.
TSXv - TSM; Frankfurt - T61 (WKN A0Y GN1); Pinksheets – TASXF
The Tasman Metals Rare Earth Story’
CORMARK SECURITIES INC. COMMENCES TASMAN COVERAGE
Dear Friends:
Cormark Securities has initiated coverage of Tasman Metals with a report entitled “The Rare Earths Mining Sector”. Cormark recommends Tasman as a Spec Buy with target price of $6.00.
The macro fundamentals continue to present a compelling case for Heavy Rare Earths projects like Norra Karr in Sweden, with excellent infrastructure and low capital cost potential.
Here are some excerpts from the Cormark Report:
"In 2010 ~125,000 t of rare earths were produced. The average price of rare earths was $40/kg, implying the rare earths mining industry is a ~$5 BB industry ($25 BB at 2011 peak prices). Based on our long-term price forecast we believe the rare earths mining industry is a ~$5 BB industry that will double in size over the next decade to ~$10 BB in rare earths sales per annum. For comparison, in 2010 the size of the uranium, chromium, and molybdenum mining industries were ~$7 BB, ~$5 BB, and ~$4 BB, respectively. From a supply side the rare earths sector stands out from other industrial minerals or other industrial mineral booms due to the lack of new capacity being developed by current producers. Unlike other industrial minerals, demand for rare earths is relatively new, with the majority of applications being commercialized in last 10 years.
The current state of the rare earths sector presents a unique industrial minerals situation in which long-term growth in demand appears very strong, but current producers are being
forced to close operations and decrease production. While China continues to try to enforce production limits of ~95,000 tpa, we conservatively forecast that by 2020 rare earths production from China will be ~140,000 tpa. Global demand for rare earths in 2020 is forecast at 240–290,000 t, leaving at least 100–150,000 t of rare earth production
capacity for the rest of the world to develop at a capital cost of $4–6 BB.
We believe projects that have near-term production potential, low capital costs, and the support of joint venture or off-take partners are the most likely to be successfully advanced to production. While the field remains open for several new rare earths producers outside of China, earlier stage projects will struggle to enter the market once the first round of new producers are established."
The full Rare Earths Mining Sector report can be obtained from Cormark Securities www.cormark.com
Stay Tuned - - as the Tasman Metals Rare Earth Story continues!!!
Regards from Vancouver,
Nick L. Nicolaas
Mining Interactive "Ahead of the Pack"
