Lynas Rare Earths’ revamps agreement to supply Japan with rare earths
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The news: Lynas Rare Earths said it has renewed and enhanced its long-term supply deal with Japan Australia Rare Earths (JARE), extending the partnership to 2038 and adding a market-linked floor price.
The numbers: In an ASX filing published after market close on Tuesday, Lynas said that it will continue to provide up to 7,200 tonnes per annum of NdPr (rare earths) to Japanese industry until 2038. Under the revised agreement, JARE agreed to purchase 5,000 tonnes of NdPR per annum with an agreed market-linked floor price of USD110 per kilogram ($154.80). Sales above the minimum volume will be by mutual agreement and at no opportunity loss to Lynas.
JARE also made commitments to cover up to 75% of Lynas’ heavy rare earths oxide output for Japan, to stabilise pricing.
When NdPr prices exceed US150 per kilogram, JARE will shares in the upside, capped at a maximum of USD10 million per calendar year.
What they said: Lynas CEO and managing director, Amanda Lacaze, said: “The new agreement will ensure continued market supply of rare earth products that are strategically important to Japanese industry and its global market, and at the same time, the implementation of fair market pricing will reduce price volatility for Lynas and enable continued growth and investment in our operations.”
The source: ASX
