Lynas Rare Earths, the world’s largest producer of rare earths outside China, reported a 2,679% surge in annual profit as it accelerates efforts to diversify its supply chain ahead of the expiration of China’s temporary export controls on medium and heavy rare earths in November.
Net profit after tax reached A$222.4 million ($159.37 million) for the fiscal year ended June 30, up from A$8 million a year earlier, though it fell short of the Visible Alpha consensus estimate of A$242.5 million. The company’s shares declined as much as 8% following the announcement.
Average selling prices rose 59% to A$80.7 per kilogram, driven by firm market prices and floor-price agreements with Japanese and U.S. customers aimed at reducing volatility. The company also benefited from improved pricing for neodymium-praseodymium, a key component in rare-earth magnets, alongside a higher share of heavy rare-earth sales under non-market-linked pricing.
Lynas outlined plans to expand its global footprint by securing new supply from ionic clay deposits worldwide. Interim CEO Pol Le Roux stated the company is in active discussions with project developers and expects to announce new deals in the near term, though details on whether these involve material purchases or acquisitions remain undisclosed.
The company has also committed to supporting the development of a magnet-processing supply chain in the United States, aligning with efforts to reduce reliance on Chinese production, which accounts for roughly 90% of global rare-earth output. Lynas operates its flagship Mt Weld mine in Australia and a processing plant in Kalgoorlie, where it has resolved prior quality issues at the facility.
Operational challenges at Mt Weld, including ore quality concerns and rising costs, have been addressed, according to management. The company is also in the process of appointing a permanent CEO following the retirement of Amanda Lacaze.
Lynas’ strategy reflects broader industry efforts to secure alternative supply chains amid geopolitical tensions and China’s dominance in rare-earth production, particularly for critical applications in aerospace, automotive, and defense sectors.
