Sydney, March 13, 2026, 10:28 AEDT
Lynas Rare Earths shares closed at A$21.17 on Thursday, extending a sharp rally after the Australian miner revamped a long-term supply deal with Japan. The stock had jumped 16.2% on Wednesday, when investors first digested the new terms. 1
The move matters because the revised pact gives Lynas a US$110-per-kg floor price on 5,000 tonnes a year of neodymium-praseodymium, or NdPr, a rare-earth oxide used in permanent magnets for electric vehicles, wind turbines and defence systems. That gives Lynas unusual price visibility for a producer operating outside China.
Japan Australia Rare Earths, or JARE, which is backed by Japan’s state agency JOGMEC and trader Sojitz, will take the 5,000-tonne annual minimum through 2038. Lynas also said 75% of its heavy rare-earth oxide output will be made available to Japanese industry, with JARE committing to buy the equivalent of 50% of all heavy rare-earth oxides Lynas produces.
Chief Executive Amanda Lacaze said the arrangement would support “reliable supply” for Japanese customers and that “fair market pricing” should reduce price volatility for Lynas while backing further investment. The company added that any sales above the minimum volume must come at “no opportunity loss” to Lynas.
The pact lands as Japan and the United States try to build rare-earth supply chains outside China, which still makes around 90% of the world’s rare-earth magnets. The structure echoes the floor-price support previously offered to U.S. peer MP Materials. 2
Morningstar analyst Jon Mills wrote that the Lynas deal suggests buyers are willing to pay a “non-China” premium. He also said Iluka Resources could benefit as Western customers look for supply outside China. 3
Jefferies analyst Mitch Ryan upgraded Lynas to Buy with a A$24 price target, writing that the revised JARE arrangement still leaves room for “higher-return Western offtakes” beyond the committed Japanese tonnage. 4
But the new terms do not cover every tonne. Lynas said sales above 5,000 tonnes a year will be by mutual agreement, while any achieved NdPr price above US$150/kg triggers a payment to JARE equal to 30% of the upside, capped at US$10 million a year.
Valuation is another fault line. Morningstar lifted its fair value estimate for Lynas to A$10 from A$7 after the deal. Yet Mills still called the shares “significantly overvalued” and argued the market price implied a long-run NdPr price well above his new US$120/kg midcycle assumption. 3
Lynas, the largest rare-earth producer outside China, said the revised contract follows its first separated heavy rare-earth oxide production in 2025 and keeps total NdPr supply capacity at up to 7,200 tonnes a year through 2038. That is the backdrop to the latest move in the shares.
