Mining Technology

Daily Newsletter

07 August 2023

Daily Newsletter

ASM to supply rare-earths alloy to magnet maker USA Rare Earth

Starting from next year, ASM will supply NdFeB alloy from the Korean Metals Plant in South Korea.

Critical metals producer Australian Strategic Materials (ASM) has signed an agreement with magnet maker USA Rare Earth (USARE) to supply the latter with neodymium iron boron (NdFeB) alloy from the Korean Metals Plant (KMP) in South Korea.

Under the five-year sales and tolling framework agreement via subsidiary ASM Korea, ASM will start NdFeB alloy supply in 2024 to USARE, which is ramping up the production of high-performance rare earth magnets.

Rare earth magnets are used in technologies ranging from mobile phones and medical devices to electric vehicles (EVs) and several defence applications.

USARE CEO Tom Schneberger said: “ASM provides us with predictable access to a non-Chinese supply of rare earth metals, which allows us to ramp up our initial production and accelerate our goal of generating revenue, while we continue to construct our own mine.”

This deal will secure the majority of metal and alloy requirements of USARE for magnet production until it begins using materials from its Round Top reserve in Texas.

In a press statement, USARE said: “USA Rare Earth is working to bring the production of these high-performance magnets back to America, supporting the future state of energy, mobility, and national security.”

ASM and USARE are looking to strengthen their respective operations to reduce reliance on China.

Located in the Ochang Foreign Investment Zone in Ochang Province, 115km south of Seoul, KMP is currently producing neodymium and neodymium iron boron alloys.

These alloys are used in the permanent magnets in EVs and wind turbines.

The facility may develop other products at a later stage, including high-purity titanium, zirconium and hafnium.

ESG 2.0 marks a shift towards stricter environmental rules

ESG is moving into a different era, which we call ESG 2.0. While ESG 1.0 was driven by voluntary corporate action, spurred by pressure from activist consumers and investors, ESG 2.0 is being driven by a new wave of government policies. The EU has taken the regulatory lead, with rules introduced or in the pipeline that will price emissions, regulate the use of the terms ‘ESG’ and ‘sustainability’ in marketing materials, and make ESG reporting mandatory. The US has taken a different approach, favoring less regulation and more financial support in the form of tax breaks for clean industry (renewables plus nuclear and hydrogen). China is planning to expand its emissions trading system to more sectors, decarbonize its heavy industry, and ramp up its use of renewables. The new policy direction is mainly motivated by the ambition to hit net zero emissions targets. But on top of this, governments are now competing for clean industry and trying to challenge China’s leadership on the production of the world’s green technologies such as solar panels and batteries, as well as the production and refinement of materials needed for energy transition such as lithium. These driving forces are leading to policy that will impact every sector, not just heavy industry, and will keep ESG near the top of the regulatory agenda over the longer term.