Australian Strategic Materials (ASM) has inked a binding agreement with Vietnam Rare Earth Company (VTRE) for the purchase of rare earth oxides from Vietnam for use as feedstock at ASM’s Korean Metals Plant (KMP).
VTRE will deliver 100 tonnes of goods for the rest of 2023, according to the conditions of the deal. The feedstock price (in USD) will be determined using a formula-based process based on published market prices for neodymium-praseodymium oxide.
“This agreement will ensure we have the feedstock needed to continue the ramp-up of production at KMP, as anticipated sales contracts progress this year,” ASM Managing Director and CEO Rowena Smith said.
Smith stated that the company is ensuring tighter monitoring of its supply chain by getting the required oxides from Vietnam and developing its partnership with VTRE, which supports ASM’s sustainability and governance responsibilities to both customers and shareholders.
As part of the agreement, both parties agreed to negotiate in good faith for a longer-term supply deal.
“While ASM remains committed to developing the Dubbo Project and processing Dubbo Project materials through the KMP, a longer term agreement with VTRE will provide the KMP with a multi-source feedstock option. This additional security of feedstock supply for the KMP, will, in turn, allow us to broaden our options for oxide sales from Dubbo once the project is up and running,” Smith said.
VTRE Chair Luu Anh Tuan also commented on the agreement, saying: “VTRE is very happy to be progressing this partnership with ASM. With the synergies between our two companies, together we can build a global rare earths supply chain that delivers our customers and partners with the highest quality products and service.“
The agreement with VTRE builds on the non-binding Memorandum of Understanding (MOU) ASM signed in December 2022 with VTRE and Korea’s Chungcheongbuk Province.
