Northern Minerals has signed a rare earths supply agreement with Germany’s Thyssenkrupp, just days after terminating a deal with China’s Lianyugang Zeyu New Materials Sales.

Thyssenkrupp has agreed to buy the entirety of the heavy rare earth carbonate from the Browns Range project near Halls Creek, Northern Minerals said in a statement on Monday.

The company did not disclose the financial terms of the deal, which takes effect immediately and includes current stockpiled product.

Northern Minerals chief executive George Bauk said the company would benefit from the lack of price caps in the agreement, noting dysprosium and rerbium prices were up 60 per cent and 35 per cent, respectively, over the year to date as electric vehicles became more popular.

Prices of rare earths elements have jumped this year on speculation that China, which controls about 80 per cent of the supply of materials used in everything from electric cars to smartphones, could curb their shipments to the US due to their ongoing trade war.

“The continued shift of new car sales to electric vehicles is gaining traction, with all major car makers introducing EV variants of existing models over the coming years,” Mr Bauk said in a statement.

“With this shift, both car and component makers are accelerating plans to invest further down the production chain in order to secure surety of supply.”

The new deal also includes a provision for Thyssenkrupp to work with Northern Minerals on potential future expansion of the project.

Northern Minerals cited a contract breach when it cancelled its two-year agreement with Lianyugang Zeyu on August 6 but did not give further details.

 

Image: Northern Minerals' rare earths plant south-east of Halls Creek, supplied by Northern Minerals.