The share price of Lynas Corporation Ltd (ASX: LYC) fell 17.3% today to 9.1 cents, despite no news from the company.
Trading volumes were large with more than 70 million shares changing hands.
Lynas is the only rare earths producer outside of China now, following the closure of Molycorp's Mountain Pass mine after it fell into bankruptcy. China accounts for roughly 95% of world production of rare earths and has an estimated 60% of the world's reserves. Demand for rare earths is increasing, as they are used in everything from magnets, turbine generators, smartphones and solar panels.
Unfortunately for Lynas shareholders, it seems a large investor appears to be selling out.
Here's the sorry story in one picture…
Foolish takeaway
Lynas' share price is likely to remain volatile until the company can prove it has a sustainable, profitable business and can meet its debt payments.