ASM Korea Co., Ltd, a subsidiary of Australian Strategic Materials Limited (ASM), has signed a five-year Framework Agreement with USA Rare Earth, LLC (USARE) for the supply of neodymium iron boron (NdFeB) alloy.
ASM noted that the Framework Agreement expands its growing customer portfolio and strengthens its strategic supply partnership with the US magnet manufacturing sector through its Korean Metals Plant (KMP). The KMP will supply NdFeB alloy to facilitate USARE’s manufacturing ramp-up of high-performance rare earth magnets.
“USA Rare Earth’s magnet manufacturing capability and approach to market makes them a perfect customer and partner for ASM. As we continue to increase our metal production output from our Korean Metals Plant, this long-term supply agreement demonstrates the growing demand and positive trajectory of the US rare earth magnet market,” ASM Managing Director Rowena Smith said.
According to Adamas Intelligence, global demand for NdFeB magnets will expand at a compound annual growth rate (CAGR) of 7.5% between 2023 and 2040, propelled by the electric vehicle and wind power industries. This will result in a proportional increase in demand for the critical rare earth elements (e.g., neodymium, dysprosium, and terbium) included in these magnets. ASM and USARE are both actively focused on expanding their respective businesses and building alternative rare earth and critical minerals supply chains to accommodate the projected growth in these and other sectors.
The announced Framework Agreement would secure most of USARE’s metal and alloy requirements for magnet production until the company begins employing resources from its Round Top reserve in Sierra Blanca, Texas.
“Having a supply agreement in place with ASM plays a critical role in delivering on our vision of achieving magnet production in 2024. 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,” USA Rare Earth CEO Tom Schneberger said.
“We are very impressed with the metal making capability that ASM established in Korea and look forward to a long-term partnership as we diversify the rare earth magnet supply chain,” he added.
The supply of NdFeB alloy is expected to begin in 2024.
