The strategic bet for a company like Molycorp is that the long-term added value from tighter integration will generate enough free cash flow to pay down the debt used in that acquisition. The monkey wrench in the formula has been the weakening global demand for high-tech goods that rely heavily on REEs for their capabilities. That hurts demand for Molycorp's ores.
MCP is trading at a P/E of about 10, and is only about a dollar above its 52-week low of about $11 (compared to a high of over $58). It would be a bargain if not for the likelihood of a very serious downturn in Europe and the U.S. That would spell further difficulty for any REE producer, no matter how dominant their position.
Full disclosure: No position in MCP at this time.