Can Ionic Rare Earths Overcome Funding and Execution Risks in Global Expansion?

Global Expansion Accelerates

Ionic Rare Earths Limited (ASX – IXR) has reported significant strides in its international rare earths strategy during the quarter ending 30 June 2025. The company is advancing projects across the UK, Brazil, the United States, and Uganda, positioning itself as a key player in developing sovereign and sustainable rare earth supply chains outside China.

Central to this progress is Ionic Technologies, the company’s wholly owned UK subsidiary, which inked a non-binding Memorandum of Understanding (MOU) with European Metals Recycling Limited (EMR). This partnership aims to secure a steady supply of end-of-life magnets for recycling at Ionic’s Belfast facility, fostering a circular economy for rare earth magnets critical to green technologies.

£11 Million UK Government Boost

Post-quarter, Ionic Technologies led the successful CirculaREEconomy consortium, awarded £11 million (approximately A$22.6 million) in UK government funding. This three-year initiative involves major automotive and materials partners such as Ford, Bentley, and the British Geological Survey, aiming to establish a fully integrated rare earth permanent magnet supply chain in the UK. The project aligns with the UK’s DRIVE35 program, targeting net-zero automotive propulsion technologies and reducing reliance on imported rare earths.

The funding will support the scale-up of Ionic Technologies’ patented hydrometallurgical recycling process, which boasts up to 61% lower carbon emissions compared to traditional mining supply chains. This initiative not only promises economic benefits but also strengthens the UK’s strategic autonomy in critical materials.

Brazilian Joint Venture Advances

In Brazil, Ionic’s 50% joint venture Viridion Pty Ltd has made notable progress. The JV delivered the first batch of recycled rare earth oxides sourced from Brazilian end-of-life magnets to local manufacturing partners, marking a milestone in establishing a domestic rare earth circular economy. Viridion has been shortlisted by Brazilian federal agencies BNDES and FINEP for substantial funding to develop downstream refining and recycling facilities.

Further cementing its footprint, Viridion secured a land grant in Poços de Caldas, Minas Gerais, to build the Centre for Rare Earths Innovation, Technology and Recycling (CRITR). This facility is poised to become South America’s first demonstration-scale rare earth refining and recycling hub, supporting Brazil’s ambitions to become a global leader in rare earth production.

US Market Engagement and Expansion

Amid growing supply pressures following China’s April 2025 export restrictions on medium and heavy rare earths, IonicRE is actively engaging with multiple US-based partners to establish magnet recycling plants across the United States. The company is also exploring the development of a US-based rare earth refinery through its Viridion JV, leveraging its patented separation and refining technology.

These efforts align with US government policies aimed at reducing dependence on Chinese rare earth imports, which currently account for 70% of US supply. IonicRE’s internal studies have identified Tennessee as a potential site for a 4,000-tonne-per-annum refinery, focusing on high-purity magnet and heavy rare earth oxides.

Makuutu Project Gains Strategic Spotlight

The company’s 60%-owned Makuutu Heavy Rare Earths Project in Uganda has gained heightened strategic importance due to China’s export controls. Makuutu hosts one of the world’s largest ionic adsorption clay deposits rich in medium and heavy rare earth oxides essential for electric vehicles and renewable energy technologies.

With existing mining licenses and infrastructure, Makuutu is positioned as a shovel-ready project to supply critical rare earths outside China’s influence. IonicRE continues discussions with the Mineral Security Partnership and potential offtakers to accelerate development and financing.

Financial and Corporate Developments

During the quarter, IonicRE completed a $3 million capital raise through convertible notes, strengthening its balance sheet to support ongoing project development. The company’s share price has more than tripled since the raise, reflecting improved investor sentiment towards the rare earths sector.

Corporate governance remains robust with shareholder meetings in May and July approving all resolutions. IonicRE is actively pursuing grant funding and strategic partnerships to underpin the construction of commercial-scale facilities, particularly in Belfast Harbour, UK.