NEW YORK — Molycorp's plunge below the value of its net assets is turning the owner of a rare-earth supply that's unmatched in the Western hemisphere into a takeover target.

The Greenwood Village-based owner of the biggest U.S. deposit of metals that go into everything from smartphones to solar panels and hybrid cars handed investors losses of 61 percent in 2012 amid a slump in rare-earth prices, cost overruns at its California mine, a regulatory probe and the departure of its chief executive. Even after the shares rebounded from a record low in November, Molycorp is trading at a 19 percent discount to its book value, according to data compiled by Bloomberg.

Molycorp's low valuation and the chance to lock in rare-earth resources could spur manufacturers from Nissan to Siemens to make a bid, according to Byron Capital Markets Ltd. After expanding its refining and processing operations with last year's purchase of Neo Material Technologies, the $1.3 billion company may even appeal to private-equity firms, Robert W. Baird & Co. said. Goldman Sachs projects that Molycorp could fetch $15 a share in a takeover, a 59 percent premium to its Dec. 31 close.

Molycorp shares Wednesday jumped 10 percent, or 95 cents, to close at $10.39.

Europium oxide 99.99% market remains stagnant with the majority of end users practicing increasingly conservative purchasing strategies. Prevailing offers of the material decrease slightly to RMB6,000-6,300/kg (USD961-1,009/kg), down by around 4% compared with RMB6,300-6,500/kg (USD1,009-1,041/kg) late last week.

A source from a separation plant in South China reported to Asian Metal that europium oxide 99.99% demand shows no signs of rebounding with mainstream offers slipping slightly to MB6,000-6,300/kg (USD961-1,009/kg) at present. “The combination of a weak downstream industry with the belief prices may still have room to fall have discouraged end users from moving to procure europium oxide 99.99% in bulk,” said the source. “We are under great pressure to complete deals.”

“I heard that some traders are willing to sell the material at prices lower than RMB6,000/kg (USD961/kg) for the time being,” added the source, revealing that the plant produces around 4 tons of europium oxide 99.99% per month.

A source from another separation plant in South China confirmed that mainstream offers of europium oxide 99.99% go down to RMB6,000-6,300/kg (USD961-1,009/kg), with a slight decrease of around 4% compared with RMB6,300-6,500/kg (USD1,009-1,041/kg) late last week. “Most consumers buy europium oxide 99.99% from hand to mouth,” said the source. “We are pessimistic about the market in the reminder of this year.”

"The last small deal was concluded at RMB6,000/kg (USD961/kg) a few days ago," added the source, revealing that the plant used to produce around 3 tons of europium oxide 99.99% per month.

Rare earth elements, as every commodities nerd knows, are in fact not very rare at all. Some, such as cerium and lanthanum, are among the more abundant elements in the earth's crust.

But it is unusual to find the 17 elements that are classified as rare earths in sufficient quantities for economic extraction.

In 2011, however, concerns over the scarcity of these elements -- which are now used in everything from mobile phones and lightbulbs to weapons systems -- sent prices skyrocketing.

"There was a bubble in 2011, after demand for rare earths had rebounded from the financial crisis and the Chinese cut export quotas, reducing supply," explains Carolyn Dennis, analyst at Dundee Securities. "Fears of a shortage caused stockpiling, driving prices to unsustainable levels."

Since then they have plunged, with prices for some rare earths falling as much as 90 per cent in international markets. This year alone, prices for the most important elements have fallen between 50 and 70 per cent, according to Industrial Minerals, a specialist publication that monitors rare earths trading.

Nevertheless, a number of mining companies are still hoping to capitalise on the strategic importance of these rare raw materials.

China currently accounts for more than 90 per cent of global supply -- partly because their production can be a messy and environmentally problematic business -- but some miners are trying to develop rare earths projects to meet demand for production outside China, particularly from countries such as Japan and Korea.

It has not been an easy 12 months for the sector's leading companies, though.

Molycorp and Lynas -- the most advanced in terms of developing commercially producing mines -- have had a torrid year.

Molycorp's share price has fallen nearly 60 per cent this year and, earlier this month, its chief executive resigned, following a range of operational and financial difficulties.

As optical glasses industry keeps flat, high purity lanthanum oxide 99.999% demand remains soft and the prices drop a bit to RMB95,000-100,000/t (USD15,210-16,010/t) at present.

A source from a separation plant in South China disclosed that lanthanum oxide 99.999% market suffers from slow buying activities due to wait-and-see attitudes of buyers. The plant quotes RMB100,000/t (USD16,010/t) for the material at the moment, down by around RMB2,000/kg (USD320/t) compared with that of last week. “Lanthanum oxide 99.999% inquiries are few and buyers are not interested in rebuilding stocks,” said the source.

The plant produces around 30 tons of lanthanum oxide 99.999% per month and hasn’t concluded transactions so far this week. The source said that lanthanum oxide 99.999% prices will fall slightly in the coming weeks.

A source from a optical glasses producer in South China also noted that they have no plan to rebuild lanthanum oxide 99.999% inventories for the time being due to soft demand from end users. “Optical glasses market is silent, which leads us to be in no hurry to buy rare earth raw material,” said the source. “We can procure lanthanum oxide 99.999% at prices a bit lower than RMB95,000/t (USD15,210/t), however, we prefer to watch the market for a while.”

According to the source, the plant used to produce 20-30 tons of lanthanum oxide 99.999% per month and it has reduced production due to weak demand.