MinRes to close Australian Garnet after Middle East sales hit

Mineral Resources (ASX:MIN) will shut its Australian Garnet operation south of Kalbarri in Western Australia, effective July 1. A financial review found the project was hit by the Middle East conflict, a region that represented a significant share of sales. Higher diesel and shipping costs also weighed on the economics.

The company said the review concluded it was in the best interests of MinRes and its shareholders to cease operations and transition the project into care and maintenance.

About 110 employees will be affected. MinRes said it would support them and offer redeployment opportunities where suitable.

MinRes acquired the Australian Garnet operation, also known as Lucky Bay, in September 2025. It bought the asset through an asset and share sale agreement with the administrators of Resource Development Group. The project holds a total mineral resource of 523 million tonnes, with 21.7 million tonnes of heavy minerals and 17.9 million tonnes of garnet. That resource supports a 28-year mine life on paper. The shutdown puts that potential on hold.

The company will assess all options for the project’s future, including a possible divestment. Any financial impact will be disclosed in its FY26 full-year results, including a non-cash impairment of roughly $40 million on the written-down value.

For a company with a market capitalisation of $12.94 billion and a share price of $65.94, the $40 million non-cash charge is small. The impairment reduces reported equity but does not drain cash. The shutdown signals that the acquisition, made less than a year ago, did not work out as planned. The Middle East conflict was an external shock. The decision to shutter rather than ride out the cycle indicates management saw limited strategic value in holding a single-source operation whose sales were concentrated in a volatile region.

MinRes will report the full financial impact in its FY26 results. No date has been set for that release.