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Arafura Rare Earths
The US-Australia minerals deal shines a spotlight on Arafura Rare Earths, aiming to curb China’s rare earth dominance and strengthen tech and defence sectors.
(AI video summary)
This video was created on 21 October 2025 for IG audiences by ausbiz.
ASX code: ARU
US support boosts rare earth sector
Arafura Rare Earths becomes the focal point of investor interest due to a groundbreaking United States (US)–Australia critical minerals agreement. This accord is set to disrupt China's dominance in the rare earth sector, which is crucial for various high-tech and defence applications.
The US Export-Import Bank has shown strong support for the initiative by issuing letters of intent for investment in several companies, including Arafura Rare Earths. Notably, the bank has conditionally approved an investment of up to US$100 million in Arafura's Nolans project located in the Northern Territory.
Turning away from China
China's control over 80%–90% of the rare earth market has led to this strategic deal. This positions Arafura as a potential alternative, capturing significant investor enthusiasm following the meeting between Australian Prime Minister Anthony Albanese and US President Donald Trump.
Investment outlook
Analysts anticipate sector upgrades, although views differ: some prefer immediate producers, while others are cautious due to the enthusiasm-driven rally.
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