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AUST Business today:
Iluka Resources is moving ahead with a plan to produce refined rare earth products in Australia, pitting the producer against fellow ASX-listed miner Lynas and putting it on a path to become only the second non-Chinese supplier of the commodities.
The mineral sands major is now considering expanding beyond selling concentrate from its rare earths operation at Eneabba in Western Australia into fullscale refining of the concentrate into higher-value products. A feasibility study into the refinery has kicked off, and talks are under way with both Australian and overseas governments over the potential push. Supplies would be sourced from Eneabba in WA and, in the longer-term , from its Wimmera zircon and rare earths deposits in Victoria if the feasibility study over the next year moves into subsequent phases.
Iluka returned to an annual net profit on Thursday, boosted by a large gain on the spin-off of its iron ore royalty business in November into a new listed company called Deterra Royalties. The company said it was now in talks with potential partners over the refinery option. “We are talking to a range of potential partners and offtakers, including governments here in Australia and other governments. We see there is a pretty clear intersection between our own commercial plans and the possibilities for Eneabba phase three and the commonwealth government’s own policy objectives to secure supply chains for critical minerals of this type,” Iluka managing director Tom O’Leary said.
Interest is rising in Australia as a potential supplier of rare earth materials, amid ongoing tensions between the West and China, which has long dominated supply of the group of 17 metals that are key ingredients in the manufacture of high-performance magnets , missile systems and other hitech equipment.
Lynas remains the only major producer of refined products outside of China.

Lynas boss Amanda Lacaze has said she is not afraid of the emergence of new competitors.
Lynas is planning to build a rare earth processing facility in Kalgoorlie, and Mr O’Leary has said that it could also be a customer for Iluka. “They could be a customer for the product we’ll be producing come the completion of phase two of our Eneabba plant,” the Iluka boss said.

The accelerating penetration of electric vehicles into European and Chinese markets has led demand for rare earth products. “The Western demand for rare earth oxide is significant and growing and I think there’s plenty of room in the market, given the global push towards electrification in coming years,” Mr O’Leary said.
The company reported an annual net profit of $2.41bn for the 12 months through December, rebounding from a $299.7m loss in 2019 and lifted by a $2.2bn gain on the Deterra spin-off. Underlying profit, which strips out one-time gains, was down 46 per cent at $151.2m. Iluka declared a final dividend of 2c a share. “Iluka observes signs of recovery in market conditions for zircon and high-grade titanium dioxide,” the company said.
Iluka rose 2 per cent to $7.53.