Australian Strategic Materials (ASM) signed an agreement with the Chungcheongbuk Province in South Korea and the Vietnam Rare Earth Company (VTRE) to establish supply of rare earth compounds for ASM’s Korean metal plant subsidiary KSM Metals.

VTRE produces various rare earth products in Vietnam largely for the Japanese market, including light and heavy rare earth alloys used in neodymium-iron-boron (NdFeB) magnets.

Last year, ASM commissioned metal production at its KSM plant to produce NdPr metal ingot for the production of bonded neodymium-iron-boron (NdFeB) permanent magnets. South Korea’s electronics industry is reliant on imported NdFeB magnets. With China’s rapid growth in demand for high-value NdFeB magnets in electric vehicle drivetrains, existing supply chains for traditional NdFeB magnet applications will be stretched and are starting to evaluate the securing of independent supply chains.

Vietnam and Thailand are currently the only significant volume sources of rare earth metals outside China, both mainly locked into Japanese magnet producers. ASM is looking to develop its own polymetallic resource in Australia, the Dubbo Project, but in the meantime will look to source rare earth oxides from VTRE as feed for its own metal plant in South Korea. This, however, requires VTRE to develop its own mine, as the company’s processing plant relies on third-party feed.