China got out to a lead. The $70 trillion rare earths comeback starts now.

Disclosure: S3 Consortium Pty Ltd and its associated entities may hold direct or indirect interests in securities referred to in this publication and may receive fees or other forms of consideration from entities mentioned. These interests and arrangements may create a potential conflict of interest in the preparation of this material.

The information contained in this communication is provided for general information purposes only and may relate to speculative investments. It does not constitute financial product advice, and has been prepared without taking into account your personal objectives, financial situation or needs. You should consider obtaining independent financial advice before making any investment decision.

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There's a particular magic to watching the world's nations gather in one place and send their very best to represent them.

The flags are raised.

The anthems play.

The handshakes are firm, the smiles are tight, and everyone pretends the old rivalries have been left at the door.

There's strategy whispered on the sidelines.

There's jostling for position.

There's the occasional bit of theatre for the watching world.

Commentators and pundits dissect every move. Crowds pick their favourites.

Allies become opponents the moment things get serious.

And through all of it, every nation is chasing the same thing - a win that defines who comes out ahead.

Millions are tuning in, holding their breath, waiting to see who finishes on top.

It is, without question, an event that captures global attention and the outcomes have ripples for years to come.

I'm of course talking about the G7 summit that was held in France earlier this week:

The “G7” or “Group of Seven” is seven of the world's biggest, wealthiest democracies, who get together once a year to talk trade, energy, security, the global economy...

and whose turn it is to pick up the bill.

The G7 countries are the United States, the United Kingdom, Canada, France, Germany, Italy and Japan.

This G7 summit was also attended by Brazil, India, Kenya, South Korea and Syria.

And as usual, most other European Union countries.

(let’s call it “G7 and friends”)

The second most important thing to come out of the G7 meet (in our biased opinion, we’ll tell you the MOST important thing in a second) was US president Donald Trump declaring a draw in the Iran conflict.

(Many commentators say that starting the conflict in the first place was an own goal.)

This was the deal that had been off again and on again for weeks, sending the markets up or down depending on whether it was on or off.

Right after President Trump signed the US-Iran deal, he said “oil down, stocks up”.

Good for the global markets, risk on mood = good for our small ASX stocks.

But that wasn’t the biggest thing that happened at the G7 meet.

(again we are biased here)

~36 hours ago, a combined US$70 trillion worth of G7 and friends economies declared a critical minerals supply emergency.

And in a joint statement pledged to bankroll, de-risk and onshore Western mining and processing...

by 2030.

Less than 1300 days away.

(source)(source)(source)(source)(source)

It appears that G7 and friends countries have slowly, then suddenly, realised that China has a 3-0 lead with 20 minutes to go, and it's time to wake up, get your best players on the field and start scrambling to catch up.

“Critical minerals” are needed to build AI, autonomous robots, quantum computers and advanced weaponry.

Basically all the high tech stuff that will determine which country dominates the next century.

The G7 statement specifically called out RARE EARTHS.

Which is no surprise, China dominates rare earths supply and processing

Globally, China does 70% of rare earths mining and a whopping 90% of processing and refining the rare earths for its critical end uses.

Here is what the G7 statement said:

“To this end, we, together with partner countries, will cooperate closely to advance production, processing and recycling projects across the entire supply chain.

We will promote the development of coordinated projects through demand aggregation and the mobilization of public and private collective financial capacities.

In so doing, we aim to significantly reduce our dependencies on a single supplier outside the G7 and partner countries for rare earths and permanent magnets to under 60 per cent by 2030 and continuing to decrease further over time, with an ambition to reach 50 per cent as soon as possible.

For other critical minerals, we task the relevant ministers with setting a specific target for reducing these dependencies before the end of the year.”

Read the full joint G7 statement on critical minerals here - it’s a ~3 minute read and definitely worth it if you are a critical minerals investor.

We think this could be the start of the co-ordinated flood of global capital we have been waiting for to chase rare earths and critical minerals mining (and recycling) projects.

(meaning share prices go up and companies raise capital to fund their projects)

Our view is that the “general investors around the world” speculative run in the critical minerals theme hasn’t started yet.

BUT it feels like it isn’t far away, especially if the government fire hose of funding continues to spray capital into the sector.

So rare earths got the call out from the G7 and friends, China mines 70% of rare earths and processes 90%...

Here are our rare earths stocks that can help:

The rare earths stocks we are Invested in...

First - advanced stage rare earths stocks that could build a mine before the 2030 G7 deadline should attract attention and capital:

• PNN - Advanced stage - with valuable MREO (the rarer type of rare earths used in advanced magnets).
• SGQ - Advanced stage - South America’s biggest and highest grade rare earths deposit

Second - earlier stage rare earths stocks with exploration could attract take over and speculation interest if they can deliver some solid drill hits OR prove a rare earths deposit, especially if it's in the USA:

• LKY - early stage exploration, but it's in the USA and next to the USA’s rare earths and advanced magnet producer “national champion” MP Materials.
• LSR - exploration stage, but it hosts the valuable and rarer heavy rare earths, located inside USA borders.
• OD6 - we are in it for the fluorspar project, but they also have a pretty nice rare earths project in WA.

And the dark horse...

Potentially the fastest to rare earths “production” of them all.

This one is on the “processing and refining side” - where China has by far the strongest grip.

Our critical minerals recycling and processing Investment Iondrive (ASX:ION).

Ion’s “deep eutectic solvent” technology recovers (recycles) critical minerals and rare earths from “electronic waste” - old electronic equipment, magnets, TV’s, phones etc

On Monday ION announced they hit 93.5% extraction rates on heavy rare earth dysprosium from e-waste and end-of-life magnets... in the USA.

(read the announcement)

Dysprosium is one of the sought after “heavy rare earths” used in advanced magnets for autonomous robots and advanced weapons systems.

Processing and recycling was another big call out from that G7 meet.

There were explicit commitments to “boost recycling of critical minerals” and that the aim was to make recycling capacity account for a “significant share” of annual consumption by 2030.

(source)

IF the G7 is going to get there then tech like ION’s will need to be commercialised and brought online.

Last week we ALSO saw the US Department of War give a US $725M loan to a US company to scale its domestic processing of rare earths:

(source)

The USA and the rest of the west are the most reliant on China for the heavy rare earths - China controls almost 100% of the supply chain.

We think the wave of capital into recycling/processing for rare earths is only just getting started in the US.

So ION could be the dark horse in our Portfolio... fastest to produce and extract heavy rare earths inside US borders...

So keeping with the "West's urgency to secure rare earths supply” theme that was fired up by the G7 statement this week...

Here is a brief overview of each of our rare earths Investments, where we summarise:

1. The company's story in a "nutshell"
2. Where the company's assets are, market caps and cash in the bank
3. Why we like the company
4. The "one image" story, and
5. What we want to see next.

Power Minerals (ASX:PNN)

In a nutshell:

PNN owns 100% of an advanced stage rare earths project in Brazil - one of the highest-grade rare earths assets on the ASX.

Historic drilling hit grades like 60.85m at 8.92% TREO from surface with high concentrations of magnet rare earths (MREO).

MREO’s are the high-value magnet rare earths that go into robots, AI hardware and defence systems.

Location: Minas Gerais, Brazil

Market Cap: ~$48M

Cash at Bank: A$6.98M at 31 March 2026 + A$1.7M raised from an international resources fund at 14.5c this week.

Why we like PNN:

Brazil holds the world's second-largest rare earths reserves behind China.

We think Brazil is one of the obvious locations for the US to invest in to secure its rare earths supply chain.

(USA Rare Earths recently agreed a US$2.8BN takeover of a producing Brazil rare earths mine)

We like PNN’s project because of its ridiculously high grades, with some of the historic drillholes demonstrating higher grades than Lynas Rare Earths project in WA and MP Materials project in the US.

Especially in terms of the magnet rare earths concentrations - PNN has 30-60m hits with 1-2% MREOs.

PNN’s project also has a special type of mining license which means it requires no approvals outside of environmental permitting to develop its project.

PNN’s project also sits in the Poços de Caldas region near ~$494M Meteoric Resources and ~$463M Viridis, an area the ASX knows well and knows how to value.

(Last week The Wall Street Journal put the spotlight on this region in this article The Fight to Break China’s Rare-Earth Dominance Moves to a New Front in Brazil)

This is the same playbook we backed with SGQ — we think of PNN as a potential "SGQ 2.0".

The "one image" story

(OK look - we had to use two images for this one - these grades are just too high not to show in image format):

(The ridiculously high grades - source)

(The neighbourhood PNN’s project sits in - source)

What's next for PNN:

PNN started its first drilling program earlier this week (~3,000m of diamond drilling).

First assays are expected to start flowing from June 2026 all building toward a maiden JORC resource for the project.

We are also looking forward to seeing some metallurgical testwork from PNN’s deposit.

Read our latest Deep Dive: PNN has started drilling its Brazil rare earths asset, with historic hits of 60m+ at 8%+ TREO

Read our latest QuickTake: PNN - International resources fund invests $1.7M at 14.5c

St George Mining (ASX:SGQ)

In a nutshell:

SGQ owns 100% of South America’s biggest and highest grade rare earth deposit.

SGQ’s project also has a large niobium resource and sits next door to the world's biggest niobium mine.

Location: Minas Gerais, Brazil

Market Cap: ~$435M

Cash at Bank: A$43.66M at 31 March 2026 + just raised $60M this week.

Why we like SGQ:

SGQ’s project is the second-largest carbonatite-hosted rare earths deposit in the world - behind only Lynas's Mt Weld, and bigger than MP Materials' Mountain Pass (the two biggest rare earths mines outside China).

Lynas is valued at $18BN. MP Materials is valued at $15BN.

SGQ’s resource starts from surface and is open in all directions - meaning it can get even bigger with more drilling - which SGQ is doing with multiple drill rigs right now.

SGQ has signed various processing and offtake MoUs and LoIs with REalloys (which supplies the US Defense Logistics Agency and the US Department of Energy's Ames Lab), Boston Metal, and Europe's Tecnicas Reunidas.

SGQ’s single biggest shareholder is Australia’s richest person, Gina Rinehart's Hancock Prospecting, now sitting at ~10.5% ownership.

This comes after Hancock Prospecting committed $20M in SGQ’s $60M capital raise earlier this week.

(source)

Interestingly also this week, Hancock invested $1.4B into the (now) $2.7 trillion capped SpaceX.

Nice to see SGQ as a Hancock Prospecting portfolio company alongside SpaceX...

(Source)

The "one image" story:

What's next for SGQ:

SGQ is currently drilling with multiple rigs 24/7 and plans to upgrade its resource again before the end of the year ahead of a feasibility study for its project.

We also want to see progress with metallurgical testwork and processing tests with the various pilot plants SGQ is working with (a niobium pilot study with results due in July 2026, and testing from SGQ’s own larger pilot plant in Q4 of this year).

SGQ said in this week’s capital raise announcement that there’s potential to develop the asset under an accelerated timeline - makes sense after bagging $60M - so watch this space...

Read our latest Deep Dive: SGQ: Rare earth and niobium in Brazil - USA deal to secure control over Brazil rare earth production

Read our latest Quick Take: SGQ secures A$60M for rare earths and niobium project - Hancock follows money with $20M in the raise

Iondrive (ASX:ION)

In a nutshell:

ION isn’t a miner - it's a critical minerals recycling tech company.

ION is developing recycling technology (which it's also applying to critical minerals processing for mining companies).

Just this week ION announced rare earth recoveries of ~93.8% of the neodymium, 95.1% of the praseodymium AND 93.5% of heavy rare earth dysprosium and other heavy rare earths from old magnet waste material (e-waste).

Location: Adelaide, South Australia (technology) + USA (rare earths testwork)

Market Cap: ~$26M

Cash at Bank: A$7.98M at 31 March 2026

Why we like ION:

Recycling is the kind of non-China, non-mining supply route the US needs.

Earlier in the year US Secretary of State Marco Rubio hosted a Critical Minerals Ministerial “with partners and allies” centered around a “whole of supply chain” fix for the critical minerals in the west - specifically including processing and recycling. (source)

And late last year the US put billions behind “minerals recycling tech”. (source)(source)

ION currently has a binding agreement with Colt Recycling - one of the largest and most advanced e-waste processors in the US - signed back in September 2025. (source)

ION also has economic studies completed for a rollout of modular rare earth processing plants to e-waste hubs (like Colt’s).

We’re Invested in ION to see it commercialise its tech - with a focus on US rare earths.

The "one image" story:

What's next for ION:

ION has a pilot plant currently under construction for its recycling tech.

On the rare earths front ION will be testing its tech on higher grade feedstock to see if recoveries and processing requirements can be optimised.

We are hoping the progress opens the door to partnering/offtakes and US funding out of the US.

Read our latest deep dive: ION: Critical Minerals recycling tech - punished for no news? Well it's back now...

OD6 Metals (ASX:OD6)

(we are in OD6 for the Flourspare project, but they have this rare earths project too)

In a nutshell:

OD6's rare earth project in WA is one of the largest clay-hosted rare earths deposits in Australia with a 682Mt at 0.1338% TREO resource.

Location: Western Australia

Market Cap: ~$35M

Cash at Bank: A$3.48M at 31 March 2026 + ~$3.4M raised in April 2026.

Why we like OD6:

We Invested in OD6 primarily for its fluorspar project in Nevada, USA, as one of our US critical minerals exposures.

BUT OD6 also has a rare earths project in WA that is genuinely massive.

OD6's rare earth project is one of the largest clay-hosted rare earths deposits in Australia with a 682Mt at 0.1338% TREO resource.

Current drilling is only on ~10% of the existing structures over the project - so it could get even bigger.

The other kicker for OD6’s project is that it has a high concentration of “magnet rare earths” - ~23% of OD6’s resource is made up of high-value magnet rare earths.

Magnet rare earths are the ones that go into producing inputs for AI hardware, robotics and defence tech.

The "one image" story:

(OD6’s MREO concentrations compared to other majors - source)

What's next for OD6:

OD6 has metallurgical testwork programs underway with ANSTO (Australian Nuclear Science and Technology Organisation) to produce bulk (>1kg) mixed rare earth carbonate samples for offtake/payability discussions.

Read our latest Deep Dive: OD6: Pulls out “exceptional high grade fluorspar mineralisation from surface” card

Read our latest Quick Take: OD6 produces low impurity fluorspar from project in Nevada, USA.

Locksley Resources (ASX:LKY)

In a nutshell:

LKY's rare earths project sits within (and surrounding) the ground held by $15BN MP Materials' Mountain Pass mine - the only operating rare earths mine in the USA.

Location: California, USA

Market Cap: ~$29M

Cash at Bank: $16.7M at 31 March 2026.

Why we like LKY:

LKY has prospects inside the ground MP Materials controls as well as surrounding it.

LKY recently completed a drill program on one of the prospects and validated its exploration model - meaning the chances of making a commercial discovery at its next prospect could be a lot higher.

LKY is also working on Rare earth processing tech development together with Columbia University.

On top of the rare earths, LKY’s project also has a previously producing antimony mine that LKY is building a restart strategy around AND received a US$191M EXIM letter of interest to finance.

The "one image" story:

What's next for LKY:

Follow-up rare earths drilling on targets to the east of MP Materials’ mine.

Read our latest Deep Dive: LKY just started drilling for this critical military metal... in the USA.

Read our latest Quick Take: LKY hits 6% rare earths oxides next door to $17BN MP Materials in California, USA

Register for LKY webinar: Next Wednesday 24th June at 12pm AEST / 10am AWST - Register for webinar

Lodestar Minerals (ASX:LSR)

In a nutshell:

LSR owns a heavy rare earths exploration project in Arizona, USA.

Location: Arizona, USA

Market Cap: ~$16M

Cash at Bank: $1.7M at 31 March 2026 + LSR raised ~A$4.7M in May 2026

Why we like LSR:

LSR’s project is very early stage - rock chips with confirmed mineralisation, but no rare earths discovery just yet.

The reason we like LSR’s project is because the project has high “heavy rare earth” concentrations AND it's in the USA.

Heavy rare earths are the more scarce, more valuable type of rare earths and China controls almost 100% of the heavies supply chain...

Heavy rare earths are high value because they are used in high performance magnets (used in EV’s, defence systems and AI hardware.

IF a discovery is made, we think LSR’s project would have a strategic importance angle to it because it sits inside US borders.

The "one image" story:

(LSR’s proximity to $15BN MP Materials’ 10X plant which will need heavy rare earth feedstock)

What's next for LSR:

LSR to complete geophysical surveys to define drill targets on the project.

Read our latest deep dive: Dysprosium, terbium and lutetium in xenotime... huh? The market liked it.

Read our latest QuickTake: LSR confirms heavy rare earths trend at US Virgin Mountain

And there they are...

We have been positioning ourselves into rare earths companies in anticipation of a flood of global capital into the sector.

Led by the West’s response to the sudden realisation that China has it by the “short and curlies” on this one.

And the G7 summit statement this week was another shot on goal.

Now apparently there is some sort of soccer tournament on that I should probably go and watch...

Have a great weekend,

Next Investors

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