Rare earth equities finished the week higher after commodities staged a recovery. While rare earth equity prices sometimes look for support from commodities prices, such as oil and precious metals, this week rare earth equities arguably took the lead, as rare earth stocks outperformed others in the sector.

Molycorp (MCP) pronounced dead by some traders early in the week after the company filed with the SEC to issue another 11.5 million shares, finished the week with two up days, locking in more than a 10% rebound from the mid May lows. Canadian miner Rare Element Resources (REE) is up 20% the last ten days and received a bump Friday as the company started trading on the Toronto Stock Exchange.

Recent analysis of China's rare earth exports indicates a drop of 53 percent year over year to April. This contradicts China's report of 46 percent rise. The analytical difference is possibly attributed to changes in the way China reports such figures. A Reuters' analysis also indicated a 1000 percent increase in average export value year over year, mostly due to last year's squeeze, but figures still indicate a 2.4 percent increase from March to April.

Rare earth equity prices outside of China have risen substantially since last year, though recently were affected, like many commodities, by the downdraft seemingly triggered by CME's action to raise margins on silver futures. With precious metals stabilizing, there is some speculation that another rise in rare earth equities may be due.

After silver and gold's run and recent correction, one question some might have is whether rare earth metals equities experienced a bubble in the big run up over the last year. Rare earth mining company equity prices have certainly outpaced revenue to date, but it's too early for the mining companies to report full production revenue. Eventual oversupply (most likely over two years away) poses longer term risks for stock pickers going long. So far though, stock prices have risen pretty well across the board for rare metals companies during the last year. Nearly tripling since December 2010, potential rare-earth market leader Molycorp (MCP) even outperformed Silver Wheaton (SLW), also considered a market leader in the silver and precious metals space.

Yet another new use for magical rare earth elements is on the way. Automakers may soon replace 150-year old spark plugs with laser igniters based on rare earth element yttrium. While rare earth elements are used for electric and hybrid vehicles, it will take some time to replace fossil fuel transportation power with electric or hydrogen-based alternatives. This new igniter technology promises cleaner, more efficient, and more economical combustion vehicles, including use in hybrids.

Researchers from Japan will describe the first multi-beam laser system small enough to screw into an engine’s cylinder head at this May’s Conference on Lasers and Electro Optics in Baltimore. The laser system can be produced at low cost, according to one of the authors. The team built its laser from rare earth yttrium with aluminum-gallium segments, one doped with rare earth neodymium, the other with chromium. They bonded the two sections together to form a powerful laser that ignites fuel in the combustion chamber more efficiently.

The impact of Japanese nuclear problems may be felt by rare earth companies. Global concerns emerge as questions arise about the safety of nuclear power and its viability in replacing fossil fuel energy. This will lead to accelerated interest in solar cells and wind power generation. Both involve rare earth elements. Electric vehicles also use rare earths and need power. Rare earths are used for solar power conversion in photo-voltaic cells and through a emerging technology that converts heat to power using cerium oxide (rare-earth metal cerium is the most abundant of the "rare-earth" metals). High power wind turbines can use an estimated 500 kg of rare earth magnets each. There are concerns that rare earths, typically found with radioactive elements, could introduce new environmental hazards. The risk may depend on who is involved.

Afghanistan has vast mineral reserves which have been detailed in several surveys. A 2007 U.S. Geological Survey (USGS) preliminary assessment conducted for Afghanistan included 1.4 million metric tons of rare earth elements in southwest Helmand province plus other strategic and industrial metals, including 3.5 million metric tons of niobium. The Afghan Ministry of Mines says there is more elsewhere in the country. The Afghan Geological Survey, which is mapping the country’s mineral resources with help from the Task Force for Business and Stability Operations, estimates the country’s mineral wealth at $3 trillion.

At a time when global consumption of rare earths exceeds production, some Russian officials are now hoping to develop an area in northeastern Russia. Russia has the largest reserves of rare earth minerals after China, according to Mineral Commodity summaries available from the U.S. Department of the Interior, although, production, like in the U.S., is negligible compared to China. The Congressional Research Service provided a report summary last fall.

South Korea’s Yonhap News Agency is reporting that North Korea and China are expected to sign an agreement on joint development of North Korea's "underground resources" this month, according to a source in Seoul. According to the Bloomberg story, which came out Tuesday, metal reserves in North Korea, including rare earths and gold, are expected to be part of the deal.

Signing of the agreement is expected to take place one day before North Korean leader Kim Jong Il's birthday, the report said, and may also include anthracite coal used to make steel.