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Highlights:
- Share price of Arafura has surged by a whopping 182% in last one year.
- Arafura is now part of ASX 300 Index.
- The mining company expects to see a surge in the NdFeB magnets demand in coming quarter.
Shares of Arafura Resources Limited (ASX:ARU) are heading north today (19 September 2022). At 11:29 AM AEST, Arafura shares were spotted trading 8.77% higher from its previous close at AU$0.40 per share.
Including today’s gain, Arafura’s share price has zoomed up 31.667% in a month, 64.58% in six months and 71.74% on a year-to-date basis. In the last one year, the share price has shot up by a whopping 182.14%. In the last five years, Arafura shares have registered a gain of 338.89%.
Meanwhile, ASX 200 Materials index (INDEXASX:XMJ) was 1.21% up at 15,615.40 points around the same time.
Worth mentioning here is that the peers of Arafura were in red today. At 11:59 AM AEST, Imdex Limited (ASX:IMD) shares were down 1.46% to AU$2.03 per share. Around the same time, Perenti Global Limited shares were down 1.88% to AU$0.94 per share.
Why are Arafura shares trading up?
Recently, via an ASX announcement, Arafura shared that it has been added to the S&P/ASX 300 Index and the changes in the indices are effective from today onwards. This might be the reason that Arafura shares are surging today.
What has happening in Arafura lately?
While sharing the quarterly report in July 2022, the company said that NdPr prices continued its solid performance in three months and provided confidence regarding Nolans project economics and sustained higher prices.
Talking about the company’s long-term outlook, the company is negotiating with Hyundai Motor Company concerning an offtake agreement for the sale of 1,000 to 1,500 tonnes of NdPr Oxide annually over seven years, commencing 2025. Both parties are working towards a definitive offtake agreement.
Moreover, the company has inked an MoU with General Electric Renewable Energy to collaborate in setting up a sustainable supply chain for NdPr for constructing energy transition and offshore wind turbines. Arafura said that both parties have also agreed to negotiate the sale and purchase agreement, under which GE would purchase Arafura NdPr.
Arafura expects that the demand for NdFeB magnets will improve in the coming quarter under the assumption of manufacturers restocking, downstream production and fresh orders to fill in the third quarter.
About Arafura
Arafura aims to become a major player in NdPr (neodymium and praseodymium) market. This material is used in making electric vehicles, mobile phones, wind turbines and robotics.
Nolans is the key project of the company and encompasses a processing plant, mine and related infrastructure. Arafura claims that once the project is fully developed, it will become a major supplier of critical minerals in the NdFeB permanent magnet market.
