St George Mining Signs Strategic Rare Earth Supply Agreement with Brazilian Partners

St George Mining

Australian mining company St George Mining (SGM) has entered into a significant five-year deal to supply rare earth metals to a pioneering rare earth magnet facility in Brazil, underscoring a strategic move to strengthen the supply chain for critical minerals.

Expanding Rare Earth Capacities

SGM's new partnership involves the Brazilian technology agency Senai and the Federation of the Industries of the state of Minas Gerais (Fiemg). The collaboration focuses on supporting pilot magnet production at the Lab Fab facility, managed by Fiemg. Although specifics such as the supply volumes remain undisclosed, this agreement marks a crucial step towards developing Brazil's rare earth capabilities. The rare earth metals for this project will be sourced from SGM's Araxá mine, with production anticipated to commence post-mine launch, though specific timelines are yet to be provided.

Collaborative Efforts and Future Plans

Alongside the supply deal, SGM has committed to multiple agreements with Fiemg and Senai, signed on December 12, to promote and research Brazilian rare earth magnet production. This includes permitting Senai to conduct metallurgical testing at the Araxá facilities. The Fiemg’s pilot facility is expected to start operations in 2025, with an initial output target of 100 tons per year of rare earth magnets, aiming to double this capacity within three years.

This initiative aligns with broader efforts to position Brazil as a significant player in the rare earth industry, potentially becoming the first large-scale rare earth magnet producer in the Southern Hemisphere.

Broader Industry Impacts

The deal follows SGM's acquisition of the Araxá mine, which is rich in heavy rare earth mineral deposits, from Houston-based fertilizer firm Ifatos. The transaction, expected to close in the coming months, adds substantial value to SGM's asset base. Additionally, this agreement is part of a larger trend, as seen with fellow Australian miner Meteoric Resources, which also signed a supply deal with Fiemg earlier this year.

The significance of these developments is magnified by recent international trade tensions, highlighted by China’s decision to restrict gallium exports to the US, emphasizing the importance of diversifying the global supply chain for rare earth elements.