Cyclic’s deal with Solvay validates its new Ontario plant’s market potential, while SRC’s rare earth sourcing deal with Vital Metals is a win for Canada over China

A pair of offtake agreements for rare earth materials, crucial for electric vehicle production, were finalized in Ontario and Saskatchewan this week.

The first agreement involves Cyclic Materials, an advanced metals recycling company based in Kingston, Ont., and Solvay, a Brussels-based rare earth chemicals producer.

Since 2021, Cyclic Materials has been developing a process to recycle rare earth permanent magnet end-of-life products into raw materials to be reused in the supply chains of electric vehicles and other technologies.

This week, the startup agreed to supply Solvay with recycled mixed rare earth oxide (rMREO) from Cyclic’s new Hub100 plant in Kingston, which had its official opening earlier this month.

Meanwhile, Australia-based miner Vital Metals has signed a deal with the Saskatchewan Research Council (SRC) to sell its stockpile of rare earth materials for $3 million. Natural Resources Canada helped to facilitate the deal.

Vital Metals originally planned to sell the same stockpile to China’s Shenghe Resources Holding Co. for around $2.4 million in December 2023. However, the mining company decided to reverse the transaction in favour of the deal with SRC.

Launch of Cyclic’s Hub100

Earlier this month, Cyclic Materials achieved a major milestone with the launch of its Hub100 plant. It marks the first scaled version of its proprietary hydrometallurgical technology, REEPureTM.

The new plant in Kingston has the capacity to recycle 100 tonnes of magnetic material per year, producing recycled mixed rare earth oxides (rMREO).

The rMREO will supply Solvay as part of the new offtake agreement, with shipments set to begin in late 2024.

This partnership between Cyclic Materials and Solvay traces back to early 2023 when the two companies signed a Memorandum of Understanding (MOU) to collaborate on the production and supply of rMREO.

Solvay positions itself as a leader in rare earth technology, saying it is at the forefront of separation, purification, finishing and formulation processes. The Belgium-based company is working to establish a major rare earth hub for a permanent magnets value chain in La Rochelle, France.

“Cyclic Materials will provide us key raw materials for our plant to successfully produce rare earths for magnet manufacture, electronics and catalysts,” said Ilham Kadri, Solvay’s CEO, in a press release at the time.

“Supplies of recycled materials are becoming critical to European manufacturers. This MOU prepares us for a future offtake agreement which will further our efforts to provide certifiably recycled materials to these markets.”

Since signing the MOU, Solvay has collaborated with Cyclic Materials to validate the compatibility of Cyclic’s recycled materials with its own rare earth separation process.

The companies have confirmed the technical and commercial viability of Cyclic’s products.

SRC’s rare earth processing facility

Meanwhile, Vital Metals agreed this week to sell rare earth materials from its Nechalacho mine located in the Northwest Territories to the Saskatchewan Research Council (SRC), a treasury board Crown corporation overseen by the Saskatchewan government.

The Canadian government recognizes the rare earth mine as a “strategic asset that contributes to the country’s prosperity and critical mineral goals,” writes Vital Metals in a press release.

The release further noted, “Canada [also] recognizes that critical minerals are strategic assets. Due to their important role in priority value chains including in electric vehicles, advanced manufacturing, and defence technologies, Rare Earth Elements (REE) are among the critical minerals identified.”

Previously, Vital Metals had plans to develop its rare earth processing facility in Saskatoon. However, these plans were cancelled last fall due to high costs.

Currently, the SRC is constructing its own rare earth elements processing facility in Saskatoon. It is likely to be operational by the end of 2024.

The facility aims to establish Saskatchewan as a hub for the rare earth element supply chain in Canada.

The SRC has developed a process to separate unrecovered rare earth oxides from radioactive monazite tailings. The plant will be capable of producing enough additional rare earths to manufacture up to 65,000 electric vehicles per year.

The rare earth materials worth $3 million from Vital Metals will go to SRC’s new processing facility once it is operational.

Earlier deals and investments

In addition to acquiring Vital Metals’ stockpile, in April, the SRC also signed an agreement to import rare earth carbonate from Hung Thinh Group, a Vietnamese minerals producer.

Under this agreement, HTG will supply SRC with up to 3,000 tonnes of rare earth carbonate annually for five years, starting in June 2025.

In turn, the SRC facility will process and separate the imported rare earth carbonate. Projections for the facility anticipate approximately 400 tonnes of rare earth metals per year beginning in 2025. The produced rare earth element products will be for sale in the international market until the end of this decade.

“Working with the international community to secure this supply of critical minerals for SRC’s Rare Earth Processing Facility marks another step forward in establishing a domestic rare earth element hub in Saskatchewan,” says Jeremy Harrison, provincial minister of Trade and Export Development in a press statement.

Earlier this year, the federal government provided $6 million in funding to support SRC’s rare earth elements processing facility. A total investment of $71 million from the province has gone to help set up the facility over the past four years.