Iluka Resources is pivoting its focus towards rare earths as the conflict in the Middle East accelerates electrification efforts.
Iluka confirmed a scale-back of its traditional mineral sands operations. The company has idled its Cataby mine and both synthetic rutile kilns, citing a cautious global market exacerbated by Middle East conflict and rising energy costs.
Total production of zircon, rutile, and synthetic rutile (Z/R/SR) plummeted by over 60 per cent compared to the same period last year.
Zircon sand production was particularly hard hit, falling to 10.5kt as the company focused on processing lower-quality material from its Jacinth-Ambrosia site in South Australia.
The company noted that while 9kt of zircon sales were delayed due to logistics constraints, it has already contracted 40kt for the second quarter, fetching price increases of up to US$120 per tonne.
While the mineral sands division navigates economic challenges, Iluka’s pivot toward critical minerals is accelerating. Capital expenditure on the Eneabba rare earths refinery has now reached AU$977 million.
The refinery, Australia’s first fully integrated facility of its kind, is being built through a partnership with the federal government.
Engineering is now 99 per cent complete, with the facility expected to be a global cornerstone for non-Chinese rare earth supply when it commissions in 2027.
Eneabbba will be a multi-decade infrastructure asset capable of processing a diverse range of feedstocks, from Australian and international projects, and producing both light and heavy separated rare earth oxides
In New South Wales, the company’s Balranald project is pioneering a novel, remotely operated underground mining technology. Mining has officially commenced with two rigs, and the project is on track to reach steady-state production by mid-2026.
Managing the transition, Iluka reported a total net debt of over AU$1.1 billion, split between its mineral sands business and the non-recourse debt funding the rare earths expansion.
The company remains focused on supply chain independence as global demand for magnet rare earth oxides, essential for electrification, continues to climb.
