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News.com.au
7 days ago
- Business
- News.com.au
America has lit a fire under the rare earths market. Now ASX juniors want Australia to do the same
Rare earths miners are hopeful of higher prices thanks to a US Government deal with California miner MP Materials Floor price of US$110/kg for NdPr could drag ex-China rare earths prices higher Developers and explorers want Australia to follow suit and provide floor pricing to build ex-China supply chain In the weeks ahead of the Federal Election, the Albanese Government launched its "Trump Card", to get miners onside and float a carrot in the face of the US Administration in a bid to allay the threat of tariffs. A $1.2 billion commitment to build a critical minerals stockpile, leveraging the geological miracle of WA with its bounty of lithium, nickel and rare earths, was proposed as a way to support a set of industries beaten down by Chinese market control and manipulation and give the US access to something it dearly wants. Like so many political commitments it was wishy-washy. What would go into that stockpile was unclear. Lynas (ASX:LYC) boss Amanda Lacaze declined last month at a media huddle in Perth to say whether the company had been in negotiations about selling material to Canberra from its Mt Weld mine near Laverton, or what price it may chase. But a shot in the arm was delivered by the Americans themselves last week, which could set prices for any similar initiative the Aussie Government wants to roll out. MP Materials, the US$7.4 billion owner of the US' only rare earths operation at Mountain Pass in California, inked US$400m in equity investments from the Department of Defense as part of a multi-billion dollar public-private partnership that will make the Pentagon a 15% shareholder in the New York listed company – a 52% gain on Thursday already putting the taxpayer in the money. Contained within that deal were loans to expand and construct new and existing magnet production plants and, crucially, a 10-year arrangement to buy or stockpile oxides from Mountain Pass at US$110/kg NdPr oxide. Even with prices in China surging in response to the news, that clocks in at roughly double the Chinese market price once value-added tax is removed. If ex-China pricing rises to meet that signal, the key circuit-breaker to kick-off stalled rare earths developments – ending low prices resulting from overproduction in the Middle Kingdom – could be triggered. Argonaut's Jon Scholtz and George Ross said the deal could provide guidance for future offtakes in Australia, such as for the Iluka Resources (ASX:ILU) Eneabba Refinery in WA, which is being supported by close to $2 billion of cheap Canberra debt. "We view this move as a positive which solidifies the US rare earth magnet supply chain. Of our covered, LYC has upside from the US Plant (separate heavies) which would fill the last remaining gap in the US supply chain," they said in a note on Monday. "While this provides precedent for ILU's Eneabba facility and potential offtakes with the Australian government for a strategic stockpile." Developers rejoice The MP Materials news unsurprisingly sent a whole host of rare earths stocks flying on Friday. And even more ASX companies are now stepping out with calls for more support for western rare earths supply. "China's price manipulation of rare earths has halted the development of dozens of otherwise viable projects globally and hurt the bottom line of companies such as Lynas," Victory Metals (ASX:VTM) CEO and executive director Brendan Clark said. "It's not that the demand isn't there it's that the economics have been artificially crushed to maintain China's dominance. "That strategy has worked for a long time, but this kind of US Government backed partnership is exactly what is needed to break that control." VTM owns the North Stanmore project in WA's Gascoyne region. It's already built strong ties with the US Government despite being based in Australia. The project, which promises to deliver critical metals including heavy and light rare earths, gallium, scandium and hafnium for the defence, semiconductor, auto and energy sectors, has already received a letter of intent for a US$190m funding package from the US Export-Import Bank. With System for Award Management approval this week it is now able to throw its hat in the ring for further support and engagement with the Pentagon and other US Government departments. Clark said he was pleased by the level of US involvement to date, and expects to see more news in the pipeline. "I predict you will see more of these types of announcements especially for the more critical rare earths like dysprosium and terbium," he said. Others, like Red Metal (ASX:RDM) boss Rob Rutherford, have called for Australia to mirror the policy direction from the DoD. His company owns the Sybella project near Mt Isa in north Queensland and he thinks the Australian Government should work with nations like South Korea and Japan to set up subsidised intergovernmental supply chains. 'It is now up to other manufacturing nations like South Korea, Japan, Europe and even Australia to invest in expanded magnet capacity with REO supply guaranteed with similar price flooring mechanisms," he said. 'I strongly believe the Australian Government should jointly fund and build magnet plants in these resource-poor manufacturing nations, government to government, on the provision they utilise Australian raw REO materials." Excitement brews in Brazil While the DoD has set its focus on the sole domestic operation in the United States – something that lead to big price gains since Friday for ASX stocks in the immediate vicinity like Dateline Resources (ASX:DTR) and Locksley Resources (ASX:LKY) (both continued climbing ~12% on Monday) – other jurisdictions could stand to benefit. The key exploration jurisdiction open to the West for rare earths outside the US and Australia is Brazil, where explorers are trying to prove up "China-style" clay-hosted rare earth deposits. Developers have been seeking to align their exploration and resource compilation efforts tailored to commodities the US desperately wants for its defence and tech markets. Alongside rare earths, that also includes critical minerals like gallium, a key component in semiconductor chips also subject to controls from Beijing. One of those is Axel REE (ASX:AXL), which is aiming to compile a maiden resource of both gallium and rare earths at its Caladão project. "As countries seek to diversify away from China's dominance, rare earths jurisdictions like Brazil, with strong resource endowments and a growing appetite for foreign investment, are rising in global importance," AXL's Pat Volpe said. "Our Caladão Project is particularly well placed in this emerging landscape. With high-grade magnetic rare earths mineralisation, and more importantly exceptional at surface gallium content, Axel's portfolio is aligned with the very materials now being prioritised by US and allied governments. "Gallium, in particular, is rapidly gaining attention for its role in semiconductors and 5G infrastructure, yet global supply is almost entirely controlled by China. Projects like ours can play a meaningful role in reshaping that balance. "This US investment will likely trigger a broader reassessment of how and where the world sources its critical minerals." Demand strength Others think it says as much about the demand side as it does supply chains. Demand for rare earth metals could lift from 93,000t in 2023 to 169,000t by 2040, according to the International Energy Agency. RareX (ASX:REE) managing director James Durrant says the MP investment highlights how important rare earth elements are to the defence sector. With investment in defence budgets increasing, more REE magnets will be required to fuel growing drone and airforce fleets, along with other military tech and weaponry. RareX owns the Cummins Range project in WA's north, a large deposit consisting of rare earths and phosphate, with high grade hits also of scandium and gallium. But it is also leveraged to any supply deals Iluka makes, with the junior collaborating with the mineral sands producer to potentially pick up the Mrima Hill project Kenya, where rare earths enriched material would be mined and then shipped for processing at Eneabba. Durrant says "diversification is always key for competition and supply security". "If the Americans are doing this, will the Ausralians follow? There's already Australian Government debt, but will they go into the equity space?" Durrant asked.
Yahoo
30-05-2025
- Business
- Yahoo
Lynas CEO says company is eyeing rare earths buys in Malaysia, Brazil
SYDNEY (Reuters) - Lynas Rare Earths is eyeing potential purchases of rare earths deposits in Malaysia and Brazil and plans to work with early-stage developers to help bring their mines online, its CEO Amanda Lacaze said on Wednesday. The world's largest rare earths producer outside of China is considering fresh growth options given macroeconomic uncertainties, she said at the Macquarie Australia Conference in Sydney. Malaysia, where Lynas has processing operations, has a lot of the same geology that is present through much of Southeast Asia, such as Myanmar, she said. Myanmar is a significant supplier to China's rare earths industry. "Yes there are deposits there, yes there are deposits in Brazil. Yes we are looking at them," Lacaze said. On Malaysian sites, Lacaze said that any development would have to come with high environmental and sustainability standards and that Lynas was open to working alongside the companies to "put our script to work". "Would we like to see them developed? Yes. Will we facilitate that development? Yes," she said. In Australia, where Lynas' Mt Weld deposit is located, an election at the weekend has returned to power the Labor government which had put out a policy to stockpile critical minerals such as rare earths. That is an "uneconomic" policy, Lacaze said. "You need to focus on developing a strong and successful business, and one which relies upon government funding to construct and then government funding to produce is probably by definition uneconomic," she added. U.S. President Donald Trump's administration has put a focus on developing rare earths deposits, having last week signed a deal with Ukraine for supply. Rare earths are used in industrial magnets and in some defence applications. But new supplies are difficult to develop and can take many years, Lacaze said. "I sometimes want to take an ad out in the Washington Post saying, 'Want Rare Earths? Call 1800 Lynas," she said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Free Malaysia Today
30-05-2025
- Business
- Free Malaysia Today
Kelantan govt seals rare earths pact with Lynas
Lynas Rare Earths CEO and managing director Amanda Lacaze said Malaysia is already recognised as a rare earths centre of excellence through Lynas's operations. (AP pic) PETALING JAYA : The Kelantan government's investment arm has struck an agreement with Australia's Lynas Rare Earths Ltd to develop the state's rare earth resources that are essential for high-tech industries. The Australian mining company said today it has signed a memorandum of understanding with the state's Menteri Besar Inc (MB Inc) that provides a framework to negotiate a deal for the future supply of mixed rare-earths carbonate feedstock to Lynas. Under the non-binding agreement, the parties will cooperate on the growth of the rare earths industry in Kelantan and work towards developing Malaysia's locally sourced and separated rare earth products. 'Malaysia's ionic clay deposits have excellent potential as future feedstock for Lynas Malaysia, particularly given their high proportion of heavy rare earths which are in demand for future facing technologies including electric vehicles and electronics,' Lynas CEO Amanda Lacaze said in a statement. She said this initiative brings together Lynas Malaysia's expertise on the rare earths industry spanning more than a decade and Kelantan's rare earth resources. 'We look forward to working with MB Inc to ensure the (rare earths) it produces meets the high environmental and technical standards required by Lynas and our customers in Malaysia as well as global manufacturing supply chains,' she added. Lynas has been operating a processing plant on the outskirts of Kuantan, Pahang, since 2012. The miner currently sources all of its rare earths from the Mt Weld mine in Western Australia. The Kelantan land and minerals office previously stated that rare earth elements have been found in large quantities in Jeli and Gua Musang. Last December, the department said it deployed drones to monitor remote locations identified as having rare earth elements to prevent illegal mining activities. News reports then indicated police had arrested 55 individuals after uncovering an illegal rare earth mining operation in Gua Musang. Meanwhile, the federal government is encouraging state administrations to allow rare earth mining. Outgoing natural resources and environmental sustainability minister Nik Nazmi Nik Ahmad was reported to have said Malaysia aims to position itself as a regional hub for rare earth mining and processing. 'Lynas's plant in Malaysia is the first plant outside China that can process heavy rare earth elements,' he said during a visit to the Lynas plant earlier this month. He added this achievement increased the nation's competitiveness in the rare earth elements market. Rare earths and geopolitics Geopolitical tension is fuelling interest in finding new sources of rare earths supply. After the US slapped ultra-high reciprocal tariffs on China last month, the Asian giant retaliated by tightening restrictions on the export of rare-earth materials, targeting US manufacturers, including Tesla. With the Trump administration now having a truce with China over its tariffs, exports of rare earths restarted this month for some companies. China remains in the driving seat as it currently refines almost all of the world's heavy rare earth elements, including dysprosium and terbium. Lynas has been seeking to break that stranglehold, and recently began commissioning a new separation circuit that will make it the only commercial producer of separated heavy rare earth products outside of China. Ironically, the opposition-controlled state of Kelantan may turn out to be a starting point in helping the US and its allies break China's virtual monopoly in rare earth elements.
Barnama
30-05-2025
- Business
- Barnama
Lynas, Kelantan Ink MoU For Mixed Rare Earths Carbonate Supply
KUANTAN, May 30 (Bernama) – Lynas Rare Earths Ltd and the Kelantan state government's investment arm, Menteri Besar Incorporated (MB Inc), have signed a memorandum of understanding (MoU) for the supply of mixed rare earths carbonate (MREC). In a statement today, Lynas said the MoU is non-binding and remains subject to the negotiation and finalisation of definitive agreements. It said the memorandum outlines a framework for both parties to strengthen, promote and develop cooperation to advance the Malaysian rare earths industry in Kelantan. 'It also provides a basis for MB Inc and Lynas to negotiate a definitive agreement for the supply of MREC feedstock to the Lynas Malaysia Advanced Materials Plant in Kuantan once the project commences production,' it added. Lynas Rare Earths chief executive officer and managing director Amanda Lacaze said Malaysia is already recognised as a rare earths centre of excellence through Lynas' operations, and the MoU marks a significant step towards developing locally sourced and separated rare earth products. 'Lynas is delighted to sign this MoU with the Kelantan state government's MB Inc. This is a significant step for Lynas and the Malaysian rare earths industry, bringing together Lynas Malaysia's over a decade of rare earths industry expertise and Kelantan state's rare earth resources,' she said. Lacaze noted that Malaysia's ionic clay deposits have strong potential as future feedstock for Lynas Malaysia, particularly due to the high concentration of heavy rare earths, which are in demand for advanced technologies such as electric vehicles and electronics. 'We look forward to working closely with MB Inc to ensure that the MREC produced meets the high environmental and technical standards required by Lynas and our customers across Malaysian and global manufacturing supply chains,' she added. -- BERNAMA
The Star
30-05-2025
- Business
- The Star
Lynas, Kelantan ink MoU for mixed rare earths carbonate supply
KUANTAN: Lynas Rare Earths Ltd and the Kelantan state government's investment arm, Menteri Besar Incorporated (MB Inc), have signed a memorandum of understanding (MoU) for the supply of mixed rare earths carbonate (MREC). In a statement today, Lynas said the MoU is non-binding and remains subject to the negotiation and finalisation of definitive agreements. It said the memorandum outlines a framework for both parties to strengthen, promote and develop cooperation to advance the Malaysian rare earths industry in Kelantan. "It also provides a basis for MB Inc and Lynas to negotiate a definitive agreement for the supply of MREC feedstock to the Lynas Malaysia Advanced Materials Plant in Kuantan once the project commences production,' it added. Lynas Rare Earths chief executive officer and managing director Amanda Lacaze said Malaysia is already recognised as a rare earths centre of excellence through Lynas' operations, and the MoU marks a significant step towards developing locally sourced and separated rare earth products. "Lynas is delighted to sign this MoU with the Kelantan state government's MB Inc. This is a significant step for Lynas and the Malaysian rare earths industry, bringing together Lynas Malaysia's over a decade of rare earths industry expertise and Kelantan state's rare earth resources,' she said. Lacaze noted that Malaysia's ionic clay deposits have strong potential as future feedstock for Lynas Malaysia, particularly due to the high concentration of heavy rare earths, which are in demand for advanced technologies such as electric vehicles and electronics. "We look forward to working closely with MB Inc to ensure that the MREC produced meets the high environmental and technical standards required by Lynas and our customers across Malaysian and global manufacturing supply chains,' she added. - Bernama
