Investing in Rare Earths: Key Insights for Success

This summary highlights the key points from our latest Rare Earths interview series on 23rd June, 2023, featuring Geoff Atkins, a veteran mining executive, has 30 years of experience and unique skills in project delivery, finance, and corporate strategy, Atkins has established two rare earth operations outside China and has started Canada's first rare earth mine. His approach aims to ensure a diverse and secure supply chain with minimized geopolitical risks and reduced development timelines.

Rare earth elements play a vital role in various industries, from electronics to renewable energy. Understanding the nuances of investing in this sector is crucial for prospective investors. In this article, Geoff Atkins, managing partner of Strategic Minerals Group, shares valuable insights from a recent gathering of rare earth companies in Barcelona. Discover the key considerations and trends shaping the industry.

‍Global Gathering of Rare Earth Companies in Barcelona 

Bringing together a diverse range of stakeholders, including feedstock suppliers and original equipment manufacturers (OEMs), the meeting provided a unique opportunity for cross-sector collaboration. Unlike typical conferences dominated by explorers, this gathering focused on the entire supply chain, from mining to end-users. The presence of various players fosters meaningful conversations about supply chain dynamics and emerging trends.

‍OEMs' Perspective: Stable Prices and Reliable Supply Chains 

OEMs voiced their concerns about the need for stability in rare earth prices and reliable supply chains. Erratic pricing poses significant challenges for OEMs as they strive to deliver consistent products to their customers. Sustainability and ESG considerations also drive OEMs to seek responsibly sourced materials. Traceability and environmental controls throughout the supply chain are crucial to meet sustainability goals and ensure long-term viability.‍

The Role of Financing and Bankability 

Rare earth developers face substantial financing challenges. The capital required for operations, working capital, and inventory can far exceed initial project costs. Demonstrating a viable business plan and securing sufficient funding are essential steps in transitioning from development to production. Bankability becomes a critical factor in attracting investors and securing favourable financing terms.‍

Expertise in Solvent Extraction Circuits 

Successful rare earth production hinges on expertise in solvent extraction circuits. The complexity of these circuits, with multiple separate processes, presents inherent challenges. Past experience and knowledge gained from developing such circuits are invaluable in mitigating risks and ensuring product specifications are met. Collaboration with professionals skilled in solvent extraction circuits enhances the chances of successful production.‍

Towards a Sustainable and Collaborative Future 

Sustainability and ESG considerations are increasingly driving the rare earth industry. Stakeholders recognize the importance of responsible mining and processing, community engagement, and sustainable pricing models. Diversifying supply sources and building resilient supply chains are also critical for risk mitigation. Collaboration and partnerships across the industry are key to achieving these goals and creating a sustainable future.‍

Conclusion 

Investing in rare earths requires a comprehensive understanding of the industry's dynamics and the evolving needs of OEMs. Stable pricing, reliable supply chains, financing, and expertise in extraction circuits are crucial considerations for success. Embracing sustainability and fostering collaboration across the industry will drive the growth and resilience of rare earth investments. By staying informed and seeking expert guidance, investors can navigate this promising sector with confidence.

‍About Strategic Minerals Group‍

The Strategic Minerals Group team provides access to international critical minerals expertise, particularly in rare earths, to guide companies throughout the entire mining cycle. Their services span market research, project development planning, client management of asset approval processes, business progress reviews, joint venture partnerships, project finance advisory, and consulting on best practice models and methods. The team's journey began with the successful establishment and operation of the Lynas rare earth mine in Western Australia and the Lynas Advanced Separation Plant in Malaysia. They later contributed to projects under Todd Minerals and Northern Minerals in Western Australia, and established Vital Metals and its subsidiary, Cheetah Resources. Leveraging their experience, they brought the Nechalacho rare earth mine in Northern Canada into operation within three years, further reinforcing their global reputation as leading developers of rare earth assets.

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