Export-Import Bank Provides $150 Million PF Financing for Australian Rare Earth Mine Development

Our company is expected to supply rare earths at an annual scale of 1,500 tons for up to 12 years
Export credit agencies from Korea, Australia, Canada, and Germany provide $780 million in cooperative loans to secure resources

The Export-Import Bank of Korea (KEXIM) announced on the 2nd that it will provide a total of $150 million in project financing (PF) for the development of a rare earth mine in Australia, including a $75 million loan and a $75 million guarantee.

With this financial support from KEXIM, it is expected that our companies will be able to secure an annual supply of about 1,500 tons of neodymium-praseodymium (NdPr) oxides, a type of rare earth essential for electric vehicle and renewable energy manufacturing processes, for up to 12 years.

Rare earth elements are key minerals for which supply diversification is required, as China virtually monopolizes the global market. As of 2023, the domestic import share from China is 62% for rare earths and 93.5% for rare earth processed metals.

A KEXIM official explained, "The United States announced in May that it will impose tariffs on Chinese permanent magnets starting in 2026," adding, "We expect that KEXIM’s financial support will actively contribute to stabilizing the electric vehicle value chain of our companies and achieving net zero."

The Australian rare earth mine development project is led by Arafura, which is developing rare earths near Alice Springs in the Northern Territory of central northern Australia. Established in 1997, Arafura is a mining company listed on the Australian Securities Exchange (ASX). Among the 17 types of rare earths, it plans to focus on producing neodymium (Nd) and praseodymium (Pr), key materials for permanent magnets used in electric vehicle motors and wind turbines.

KEXIM, along with export credit agencies from Australia (EFA), Canada (EDC), Germany (Euler Hermes and KfW), plans to provide $780 million in cooperative financing for this project to secure resources for their domestic companies. Previously, KEXIM has established a close cooperative system by signing MOUs with export credit agencies from Australia (EFA), Canada (EDC), and Germany (KfW) for cooperation in critical mineral projects.

A KEXIM official stated, "Since Australia is an eligible country under the U.S. IRA, securing rare earths this time is expected to enhance the competitiveness of domestic electric vehicle manufacturers and expand their market access," adding, "We will continue to strengthen international cooperation and actively engage in financial support to secure essential resources needed by our companies."

Additionally, on the 1st, KEXIM President Yoon Hee-sung met with Martin Ferguson, Chairman of the Australia-Korea Business Council, Jeff Robinson, Australian Ambassador to Korea, and executives from six Australian companies including Arafura, ASM, and Renascor at KEXIM’s headquarters in Yeouido to conduct in-depth discussions on ‘Korea-Australia mineral and decarbonization joint business cooperation plans.’