ASX Rare Earth Stocks Skyrocket on $8.5 Billion Trump-Albanese Deal

Key Points

• ASX rare earth stocks are surging following a US-Australia agreement to enhance supplies of rare earths and critical minerals amidst US-China trade tensions.

• China’s recent restrictions on rare earth exports increase the urgency for the US to source alternatives, benefitting Australian stocks with substantial deposits.

• Lynas Rare Earths, Arafura Rare Earths, Brazilian Rare Earths, Iluka Resources, and Northern Minerals are all experiencing significant share price gains, with Arafura and Northern Minerals securing major government-backed investments and support.

ASX rare earth stocks are soaring today.

Australian miners are catching investors' attention on Tuesday, following a significant overnight deal between US President Donald Trump and Australian Prime Minister Anthony Albanese.

Albanese is currently in the US for his first face-to-face meeting with Trump.

The agreement, signed at the White House, will provide the US with greater access to Australia's rare earths and other critical minerals amid rising trade tensions with China.

According to Albanese (quoted by Bloomberg), the deal constitutes an $8.5 billion "pipeline ready to go".

ASX rare earth stocks stand to benefit in several ways. Australia and the US have agreed to each invest over $1 billion in initial projects over the next six months. The US government will also support the development of a 100-tonne-per-year advanced gallium refinery in Western Australia.

"In about a year, we'll have so much critical mineral and rare earths that you won't know what to do with them," Trump remarked, indirectly criticizing China.

What's Happening with Chinese Exports?

Earlier in October, China intensified its ongoing trade war with the US by announcing various restrictions on its rare earth exports.

By most estimates, China still controls at least 70% of the world's rare earth production. Rare earths comprise a range of elements crucial for modern technologies, including mobile phones, rockets, aircraft, and EVs.

The US has been pushing to secure essential rare earth sources outside of China's control for some time. China's latest move has increased this urgency, which bodes well for ASX rare earth shares.

Australia holds the world's fourth-largest rare earth deposits, following India, Brazil, and leading producer China.

How Are ASX Rare Earth Stocks Performing Today?

As of late morning trade, shares in the S&P/ASX 200 Index (ASX: XJO) listed Lynas Rare Earths Ltd (ASX: LYC) are up 3.7%, trading at $21.26.

Arafura Rare Earths Ltd (ASX: ARU) shares are soaring, up 21.9% to 59 cents each. This boost follows the announcement of conditional approval for up to $100 million investment from the Australian government to advance its Nolans rare earth project in the Northern Territory.

Brazilian Rare Earths Ltd (ASX: BRE) shares are also having a strong day, up 4.4% to $5.94.

Meanwhile, shares in Iluka Resources Ltd (ASX: ILU) – which produces zircon and high-grade titanium dioxide feedstocks (rutile and synthetic rutile) – are up 7.7% trading at $8.14 each.

Finally, Northern Minerals Ltd (ASX: NTU) is up 13%, trading at 6.1 cents.

Northern Minerals announced this morning that it has received non-binding and conditional letters of support from "key Australian and US government agencies" backing the financing and development of its Browns Range Heavy Rare Earths Project in Western Australia.