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Highlights
VHM (ASX:VHM) secures LOI with Mitsui & Co for heavy mineral concentrate offtake
Mitsui may extend trade finance support subject to due diligence
Goschen Project development plans advance toward production
Rare earth and mineral sands company VHM Ltd (ASX:VHM), listed on the All Ordinaries, has entered into a letter of interest with Japanese conglomerate Mitsui & Co (TYO:8031). The agreement outlines collaboration on the supply of heavy mineral concentrate from the Goschen Project in Victoria.
The Goschen Project, identified as an integrated tier-one rare earth and mineral sands asset, is targeted for production commencement in the final quarter of calendar 2026. This letter marks a key step in the progression of VHM’s development strategy, aimed at establishing long-term offtake relationships and supporting future operational stability.
Framework for Future Supply Agreement
The letter of interest spans a three-year term from the commencement of production and is intended to guide both parties toward a formal offtake agreement. Under this framework, VHM is expected to supply, and Mitsui to purchase, a substantial portion of the heavy mineral concentrate produced at Goschen.
The agreement is non-binding at this stage but represents an intent to collaborate closely on shaping the commercial terms of future supply. It also aligns with VHM's broader strategy of securing stable sales channels for key outputs such as rare earth minerals and zircon.
Financing Discussions Embedded in Partnership
In addition to the offtake pathway, Mitsui may propose a trade finance facility to VHM, subject to due diligence procedures and final negotiations. The scope and structure of this facility are yet to be confirmed but reflect Mitsui’s interest in establishing a deeper business relationship with VHM beyond traditional offtake arrangements.
This development introduces a prospective funding avenue, aimed at supporting VHM during the capital-intensive phase leading into full-scale production at the Goschen site. The inclusion of trade finance in early-stage collaboration underscores the growing alignment between the two entities.
Leadership Remarks and Forward Engagement
Commenting on the collaboration, VHM Managing Director Ron Douglas described the letter of interest as a milestone in partnering with a well-established international entity. Mitsui & Co, active in over sixty countries, has a wide-ranging portfolio spanning energy, infrastructure, minerals, and logistics.
The engagement with a global counterparty provides VHM with access to international networks and enhances the company’s credibility within the mineral sands and rare earths sector. The broader relationship envisioned by both parties may evolve into additional commercial partnerships as the Goschen Project progresses through its development stages.
