Aclara Resources, a Canada-based mining company, is intensifying efforts to secure over $1.5 billion in financing for its rare earth projects in Brazil and Chile, with CFO François Motte prioritizing contracts with automakers and other industries reliant on these critical minerals.
Essential for electric vehicles, wind turbines, and robotics, rare earths are in high demand, and Motte aims to lock in offtake agreements to convince lenders to fund the company’s South American pilot projects, targeting production by 2028 and positive cash flow by 2029.
Motte faces challenges in a volatile rare earth market long dominated by China, where pricing fluctuations and recent tariffs complicate negotiations. “It’s not easy,” Motte said, noting that banks require commercial contracts before providing funds.
China’s temporary export suspension in April, following U.S. tariff hikes, has heightened Western manufacturers’ urgency to secure alternative supply chains, shifting their focus from price to reliability. Aclara’s eco-friendly mining process, which avoids open pits and recycles wastewater, is a key selling point Motte emphasizes to potential buyers.
Aclara, majority-owned by the Hochschild Group and listed on the Toronto Stock Exchange, is also tapping into U.S. demand through a partnership with Virginia Polytechnic Institute to operate a pilot separation plant in Blacksburg, Virginia, set to open this fall.
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The facility will process feedstock from Aclara’s Carina project in Brazil, extracting critical elements like didymium, terbium, and dysprosium. This aligns with U.S. efforts to boost domestic rare earth production, supported by the Trump administration’s push for expanded mining and processing.
However, U.S. tariffs pose a hurdle, with a recent 50% duty on Brazilian imports, including rare earths, effective August 6. Motte remains optimistic, expecting exemptions or reduced duties by 2028, citing the U.S.’s critical mineral strategy and Brazil’s growing role in heavy rare earths.
Aclara’s experience navigating setbacks, like a permitting issue in Chile after the 2021 election, has strengthened its adaptability, with Brazil now a key growth area.
Motte’s strategy hinges on demonstrating Aclara’s reliability and sustainability to secure contracts, which are crucial for financing. As global demand for rare earths surges, Aclara’s efforts to establish a non-Chinese supply chain could position it as a vital player in the green technology sector, provided it overcomes tariff and market challenges.
