Iluka Rare Earths Deal Tests Sector Demand for Non-Chinese Supply

Iluka Resources signed its first customer for the Eneabba rare earths refinery. A global automotive company will buy 1,200 tonnes of magnet rare earth oxides over four years starting in 2028, Iluka said. The offtake covers about 10% of planned output. The agreement uses a floor-plus-market pricing mechanism. Minimum revenue over the contract is US$155 million. At industry-forecast prices, that rises to US$172 million.

Managing director Tom O'Leary said the deal is significant because it includes both light and heavy magnet rare earths and uses minimum prices agreed privately, not government-backed. "Beyond being Iluka's first, the agreement is significant in that it encompasses the full suite of light and heavy magnet rare earth oxides and contains minimum prices agreed between commercial parties that are independent of those backed by governments," he said. He added that discussions with other prospective customers are ongoing.

Separately, Export Finance Australia confirmed Iluka can draw the full A$1.65 billion non-recourse loan the Australian government earmarked for the Eneabba refinery. That removes a financing condition that had hung over the project. Civmec won the contract for structural, mechanical, piping, electrical and instrumentation works to complete the construction. The refinery is now over 50% complete, with commissioning targeted for calendar 2027 and ramp-up through 2028.