SEONG-AN Secures American Rare Earth Elements, Paving the Way for a New Supply Chain Beyond Chinese Dominance

5 Jan 2024

Financial News 2023.08.04 15:51 Modified 2023.08.04 15:51

Original source:

[Financial News] As China, the world's largest producer of rare earths, moves to maintain its hegemony, interest in securing rare earths is increasing. Since August 1st, the Chinese government has implemented measures to prohibit the export of Gallium and Germanium without government permission.

According to the financial industry on the 4th, while many countries and companies around the world are working hard to secure rare earth elements, KOSPI listed company SEONG-AN succeeded in securing American rare earth elements.

On the 31st of last month, SEONG-AN announced it signed a contract to purchase Neodymium-Praseodymium (NdPr) oxide with MP Materials, an American rare earth company. Supply will begin in October. The supply amount is 240 tons, which can be expanded up to 2,000 tons through future negotiations.

MP Materials is a company listed on the New York Exchange that mines rare earth elements from their own Mountain Pass mine in California, USA.

SEONG-AN, originally a textile company, is currently pursuing the rare earth business as a new growth engine. Last June, SEONG-AN began preparations for the new business by recruiting Vice President Kenji Konishi, a former Managing Director of JLMAG, a leading Chinese rare earth company and Nonexecutive Director Dr. Sang Mo Woo, a metal engineering expert. Subsequently, the NdPr metallization plant in Vietnam began test operation in July.

In order to produce rare earth magnets, which are crucial materials for EV motors, the process of metallizing rare earth oxide is essential.

The rare earth metallization plant located in Binh Duong Province; Vietnam is capable of producing 144 tons of NdPr metal per year. SEONG-AN plans to expand production capacity to 720 tons through additional expansion within the year. The produced prototype is currently being tested for purity using inductively coupled plasma (ICP) mass spectrometry equipment.

Verification is in progress at certified organizations such as the Korea Institute of Industrial Technology.

One of SEONG-AN official said, “We are still receiving requests for samples from several Asian rare earth companies,” and added, “We plan to process the rare earth oxides obtained from MP Materials into metal in Vietnam and sell them around the world.”

He continued, “We plan to increase NdPr metal production capacity up to 2,000 tons in the future, and assuming the current market price, sales of approximately KRW 200 billion are expected to be possible.”