Australian Strategic Materials (ASX ASM)- Bard's view

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ASM's Dubbo Mine: A Promising Project in the Rare Earths Realm
ASX-listed Australian Strategic Materials (ASM) holds the Dubbo Project, a significant deposit of rare earths and critical minerals located near Dubbo, New South Wales, Australia.

This project is considered one of the most promising outside of China due to its:

Large resource base: Containing rare earths like neodymium, praseodymium, dysprosium, and terbium, along with zirconium, niobium, and hafnium, the Dubbo Project boasts a multi-decade lifespan.

Advanced stage of development: With all major approvals and licenses secured, the project is construction-ready, aiming to commence production soon.

Focus on sustainability: ASM prioritizes clean resource development, targeting net-zero carbon operational emissions at the Dubbo mine.

Here's a closer look at the project:

Location:

Dubbo, New South Wales, Australia
The Dubbo mine is situated about 400 kilometers northwest of Sydney, offering convenient access to infrastructure and logistics.

Products:

The project will produce various rare earth oxides, catering to the growing demand for these elements in clean technologies like electric vehicles, wind turbines, and permanent magnets.

Processing:

ASM plans to build a processing plant near the mine to initially convert the extracted rare earths into oxides. These oxides will then be shipped to their metals plant in South Korea for further refinement into high-purity metals.

Timeline:

While an exact date is yet to be confirmed, ASM aims to commence production at the Dubbo mine within the next few years.

Challenges and Opportunities:

Like any large-scale mining project, the Dubbo mine faces certain challenges, including:

Financing: Securing the necessary capital for construction and operation is crucial.
Environmental considerations: Implementing sustainable practices and minimizing environmental impact are essential.
Competition: The global rare earths market is becoming increasingly competitive.

However, the project also presents several exciting opportunities:

Potential to become a major supplier of rare earths: The Dubbo mine has the potential to significantly reduce reliance on China for these critical elements.

Creating jobs and economic growth: The project is expected to generate hundreds of jobs during construction and operation, boosting the local economy.

Advancing clean technologies: The rare earths produced at the Dubbo mine will be essential components of various clean technologies, contributing to a more sustainable future.

Overall, ASM's Dubbo Project is a promising development in the rare earths landscape. Its large resource base, advanced stage of development, and focus on sustainability make it a project to watch closely in the coming years.

Remember, this is just a glimpse into the project. You can find more detailed information on ASM's website: https://asm-au.com/.

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https://asm-au.us4.list-manage.com/t...b&e=a929e4d016

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ASM Market Outlook (Jan 2024): Summary of info on page 11 https://asmd.irmau.com/site/pdf/39ec...low-Report.pdf

Positives:

Potential boost for Australian suppliers: US policy changes could benefit ASM (Australian) in accessing US government contracts.

EV demand drives NdFeB demand: Growing EV market & stricter sourcing rules create opportunity for ASM's non-Chinese NdFeB alloys.

Stable/rising prices: Prices for key ASM products (NdFeB, Zirconia, Hafnium) are stable or increasing, indicating strong demand.

Challenges:

Potential dip in Zirconia prices: Prices might fall in H1 2024.
Hafnium scarcity threat: Future scarcity could push prices up.
Other trends:

US EV market expected to grow (17% in 2023 → 24% in 2024).
Zirconia consumption likely to increase in 2024, with further growth in the medium term.
Hafnium market outlook positive despite end-of-year price dip.

Overall:

Positive outlook for ASM, potential opportunities from US policy changes and growing EV demand.

Challenges lie in potential price fluctuations for some materials and future supply constraints.

https://www.fueleconomy.gov/feg/tax2023.shtml 4 All figures for rare earths, NdFeB alloys and EVs are from/derived from Adamas Intelligence

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Neodymium, praseodymium, dysprosium, and terbium, are used in electric motor magnets, but in different ways:

Neodymium: This is the main ingredient in neodymium magnets (NdFeB), the most common type of permanent magnet used in electric motors. These magnets offer a strong magnetic field in a small package, making them efficient and lightweight.

Praseodymium: Often added to neodymium magnets in small amounts to improve corrosion resistance without significantly affecting magnetic performance.

Dysprosium and Terbium: These are heavy rare earths added to neodymium magnets to enhance their high-temperature performance. They increase the coercivity, meaning the magnet's ability to resist demagnetization at high temperatures, which is crucial for electric motors in applications like electric vehicles that generate significant heat.

Neodymium: Main ingredient, providing strong magnetic field
Praseodymium: Improves corrosion resistance (small amounts)
Dysprosium: Enhances high-temperature performance (small amounts)
Terbium: Enhances high-temperature performance (small amounts)

It's important to note that while all four elements play a role, neodymium is the essential component found in all neodymium magnets, while the others are added in smaller quantities for specific functionalities.

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Rowena Smith sits down with Jack Lifton on ASM’s ‘Mines to Metal’ Advantage in Supplying Rare Earths

During an interview at PDAC 2024 in Toronto, Jack Lifton of InvestorNews sat down with Rowena Smith, the Managing Director of Australian Strategic Materials Ltd. (ASX: ASM), to delve into the company’s position and strategic initiatives within the rare earths and permanent magnet supply chain. Smith elucidated ASM’s comprehensive strategy, spanning from “mine to metal"

By InvestorNews on Mar 17, 2024 03:50 pm

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https://youtu.be/88P8wwWYt0Y March 17, 2024

Australian Strategic Materials Ltd (ASX: ASM): Key Points

Business: Emerging vertically integrated producer of critical metals for clean technologies.

Strategy: "Mine to metal" model - extracting, refining, and manufacturing rare earths and critical minerals.

Projects:
Dubbo Project (NSW, Australia): Advanced development project for rare earths and critical minerals. (Fully permitted)

Korean Metals Plant: Operational plant producing NdPr metal and NdFeB strip alloy (for sintered magnets).

Significance:
First Australian and among a few globally to achieve this level of supply chain integration outside China.

Reduces dependence on single-source suppliers and diversifies the global critical minerals supply chain.

Current Focus:
Securing funding and off-take agreements for the Dubbo Project.

International Interest:
Smith's participation in U.S. trade delegation reflects strong international interest in funding the project.

Alignment between Australian and U.S. interests in establishing a secure critical minerals supply chain.

Engagement with U.S. government and designation as a 'domestic source' for the U.S. Department of Defense.

Future Outlook:
Ongoing discussions for offtake agreements.
Advancements in metallization capability at the Korean Metals Plant.
Strong commitment to securing a robust position within the global rare earth metals and alloys supply chain.

Disclaimer: The author of this post, may or may not be a shareholder of any of the companies mentioned in this column. No company mentioned has sponsored or paid for this content.