By  Paul Ploumis 02 Sep 2015  Last updated at  06:11:06 GMT

LOS ANGELES (Scrap Monster): Further to sharp fall in prices, the Greenwood Village, Colorado-based Molycorp has decided to temporarily suspend production activities at its Mountain Pass, California mine. According to company announcement, it will transition the facility to a “care and maintenance” mode by October 20th. Earlier during the year, the company had filed for Chapter 11 bankruptcy.

The company’s production facilities in Estonia and China will continue to serve its rare earth oxide customers. The temporary suspension will not have any impact on the company’s customers for rare earth magnetic materials and rare earth based water treatment products. The site, including idled machinery and equipment, will be maintained to ensure it remains in a safe and stable condition, so as to meet government regulatory commitments.

According to company officials, rare earth pricing has declined dramatically over the past several years and this has forced the company to halt production at the mine.

Molycorp is being advised by the investment banking firm of Miller Buckfire & Co. and is receiving financial advice from AlixPartners, LLP.  Jones Day and Young, Conaway, Stargatt & Taylor LLP act as legal counsel to the Company in this process.

The Mountain Pass facility dominated worldwide REE production from the 1960s to the 1980s. The mine closed in 2002, in response to both environmental restrictions and lower prices for REEs. The mine remained inactive post 2002, though processing of previously mined ore continued at the site. After facility improvements, the mine was later reopened in mid-2014.