Vital has its finger on the pulse of rare earths supply...

Vital has its finger on the pulse
of rare earths supply security

Rare earths supply security continues to be a concern for countries outside of China given their importance in the production of high tech products such as electric vehicles and military equipment.

Little wonder then that one of the topics discussed during recent meetings between the US, Japan, India and Australia – the informal alliance known as the Quad – was on how to guarantee supplies of critical minerals.

This increasing focus on non-Chinese supplies of rare earths is certainly welcome for companies such as Vital Metals (ASX:VML), which has started mining operations ahead of starting production at its Nechalacho project in Canada’s Northwest Territories.

The contract mining fleet has mobilised to the North T Zone deposit at Nechalacho, bringing the company another step closer to becoming Canada’s first rare earths producer.

Contractor Det’on Cho Nahanni Construction will complete site establishment, mining, crushing, screening and other works while the ore sorter and other equipment will be transported to site by the end of March 2021.

First stage production of a mixed rare earths carbonate is poised to begin in the second quarter of 2021.

Increasing rare earths demand

Supply chain security is not the only driver for rare earths companies.

Growing demand for electric vehicles, wind energy, consumer electronics and global smart homes are all expected to help drive rare earths demand.

Already prices of neodymium have risen 37.35 per cent since the beginning of 2021 while Morgan Stanley has projected that neodymium-praseodymium oxide demand will increase from about 47,000t in 2020 to 83,000t in 2030.