(Reuters) - Rare earths producer Arafura Resources Ltd said on Tuesday it has signed an agreement with Chinese permanent magnets manufacturer Baotou Tianhe Magnetics Technology Co Ltd for supplying rare earth products.
Under the memorandum of understanding, Arafura will be supplying Baotou up to 900 tonnes per annum of Neodymium-Praseodymium (NdPr) oxide - used in industrial magnets - from its Nolans project in Northern Territory, Australia, subject to a final off-take agreement.
Rare earths are a group of 17 chemical elements used in everything from high-tech consumer electronics to military equipment.
Australia contains only 2.8% of the world’s rare earth reserves, but accounts for more than half of the new projects in the global pipeline.
The United States and Australia are set to release a plan on Friday aimed at securing the supply of rare earth minerals, as the former looks to secure the supply of the mineral amidst a protracted trade war with China.
China is the world’s largest processor and producer of the minerals, accounting for more than 80% of global processing capacity.
Reporting by Soumyajit Saha in Bengaluru; Editing by Rashmi Aich