Are these the best ASX rare earth stocks to watch in 2024?

Discover these rare earth mining companies in Australia available on the ASX

Data as of 14 December 2023. Source: Stake, ASX, Google.

*The list of shares mentioned is ranked by market capitalisation. When deciding what dividend shares to feature, we analyse the dividend yield, consistency of dividend payouts, financials, recent news, the state of the industry, and whether or not they are actively traded on Stake.

Decide which is the best Australian rare earth stocks for your portfolio

1. Lynas Rare Earths Limited ($LYC)

Market Capitalisation: $5.65b

Stock price (as of 14/12/2023): $6.36

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 62% / 38%

Lynas Rare Earths claim its Mt Weld Mine in Western Australia is one of the world's highest grade deposits. The company processes and separates the materials at a plant in Malaysia. They are expanding their downstream processing capacity by building a new facility in Kalgoorlie. Lynas is one of only two major producers of these critical minerals outside of China. It's considered to be the second largest source of rare earths behind MP Materials' Mountain Pass mine and processing operations in California, U.S., in this respect.

🆚 Compare LYC vs ILU stock comparison→

2. Iluka Resources ($ILU)

Market Capitalisation: $2.86b

Stock price (as of 14/12/2023): $6.81

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 68% / 32%

Iluka Resources is known as a mineral sands producer, sourcing industrial commodities like zircon for ceramics and rutile used to create titanium. One by-product of these operations is a mineral containing rare earths, called monazite. Since the 1990s Iluka has been stockpiling monazite and plans to use the materials to feed their Eneabba rare earths refinery in Western Australia. Iluka has secured a $1.25 billion loan from the Australian government to develop the facility due as part of its critical minerals strategy and it is expected to come online in 2025. Eneabba could also receive minerals from third parties and Iluka's other potential rare earth projects like Wimmera in Victoria.

3. Arafura Rare Earths ($ARU)

Market Capitalisation: $412m

Stock price (as of 14/12/2023): $0.165

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 68% / 32%

Arafura Resources is developing the Nolans Project in the Northern Territory. They plan to mine and process the ore into rare earth oxide at a single site, located around 135 km from Alice Springs. Arafura has established contracts to sell rare earth oxides to Hyundai and Kia. The team is also negotiating with GE Renewable Energy, which is interested in collaborating to establish a sustainable supply chain of NdPr materials. Depending on the final investment decision, they expect to reach first production in H2 2025.

4.  Lindian Resources ($LIN)

Market Capitalisation: $190m

Stock price (as of 14/12/2023): $0.155

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 62% / 38%

Lindian Resources has a portfolio of mining assets in Africa. The team has recently been completing studies at the Kangankunde Rare Earths Project in Malawi. They're analysing the results to put together the mine plan for the site, which could have an extended mine life of up to 50 years. Production could potentially start by 2027. Lindian also owns a bauxite project in Guinea, as well as other bauxite interests in Tanzania.

5. Northern Minerals Ltd ($NTU)

Market Capitalisation: $177m

Stock price (as of 14/12/2023): $0.03

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 68% / 32%

Northern Minerals' licences cover around 2750km2 of land across Western Australia and Northern Territory. They intend to develop their flagship asset, the Browns Range Project, in three stages. This asset has particularly high levels of the rare earth elements dysprosium and terbium. The team plans to test and market a mixed RE carbonate product ahead of the final investment decision in 2024. Northern Minerals has a strategic partnership with Iluka, which will contribute some funding and allow their products to be processed at Enneaba. They have two other prospective rare earths projects in the same states, known as John Galt and Boulder Ridge.

6. Encounter Resources ($ENR) 

Market Capitalisation: $105m

Stock price (as of 14/12/2023): $0.265

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 60% / 40%

Encounter Resources holds a number of mining exploration projects in Western Australia and the Northern Territory. A drill program is planned at the Aileron Copper-Rare Earths Project in Western Australia in June 2023. Results from these activities could be available by July. Encounter also has a large exposure to copper, with work at several projects being funded through partnerships with big firms like BHP ($BHP), IGO Limited ($IGO) and South32 ($S32).

💡Related: ASX Copper Stocks to Watch→

7. Ionic Rare Earths ($IXR)

Market Capitalisation: $89m

Stock price (as of 14/12/2023): $0.021

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 63% / 37%

Ionic Rare Earths is focused on advancing the Makuutu Rare Earths Project. It's located in Uganda, around 160 km east of the capital city of Kampala. They have rights to up to 60% of the asset. Mining could start in 2024 and the firm is assessing the potential of adding upstream activities to their operations. Makuutu is one of a few large global ionic adsorption clay deposits, which is a similar geology to those in southern China that have been the source of significant amounts of rare earths to date.

8. Peak Rare Earths ($PEK)

Market Capitalisation: $85m

Stock price (as of 14/12/2023): $0.315

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 56% / 44%

Peak Resources is working on the Ngualla Rare Earths Project in Tanzania. Their plans include constructing a mine, mill, concentrator, community projects and associated infrastructure. Some value-adding activities will occur in Tanzania and the study about further downstream opportunities will take place with the government. There's also potential to develop niobium-tantalum, phosphate, fluorspar and barite minerals at the site in the future.

9. Hastings Technology Metals ($HAS)

Market Capitalisation: $83m

Stock price (as of 14/12/2023): $0.665

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 69% / 31%

Hastings Technology Metals intends to develop the Yangibana Rare Earths Project in multiple stages. The Western Australian asset could see construction start this year and its first rare earth concentrate being sold by 2025. The team is also planning to build a processing plant in Onslow, which would produce a mixed rare earth carbonate containing rare earth oxide and NdPr components. Hastings also has the Brockman Project in the same state, which is prospective for rare earths and other metals.

10. American Rare Earths ($ARR)

Market Capitalisation: $65m

Stock price (as of 14/12/2023): $0.155

Stake Platform Bought / Sold (1 Jan 2023 - 14 Dec 2023): 55% / 45%

American Rare Earths owns three early stage rare earths assets in the U.S. Their Halleck Creek Project in Wyoming has a resource of 1.43 billion tonnes of rare earths, and the team is doing further studies about the geology of the site. These results should feed into preliminary project plans and economic forecasts. There’s also potential for rare earths at their La Paz Project in Arizona, which could be one of the largest deposits in the country. Their Searchlight Project in Nevada is approximately 30 km from the exiting Mountain Pass Rare Earths Mine.

How to invest in rare earth stocks in Australia?

The main way of investing in rare earth metals is through rare earth companies listed in Australia, using an online investment platform.

1. Open a stock investing account

To invest in rare earth shares and ETFs, you'll need to sign up to an investing platform with access to the ASX and Cboe Australia. Lucky for you Stake has access to both stock exchanges.

2. Fund your account

Complete an application with your personal and financial details. Fund your account with a bank transfer, debit card or even Apple/Google Pay.

3. Search for rare earth shares or ETFs

Find the asset by searching for the name or ticker symbol. Do your own research to ensure it is the right investment product for your own circumstances.

4. Choose an order type and buy the asset

Buy on any trading day with a market, limit or stop order. Look into dollar cost averaging to spread out your risk, which smooths out buying at consistent intervals.

5. Monitor your investment

Optimise your portfolio by tracking how the security performs with an eye on the long term. You may be eligible for dividends and shareholder voting rights that affect your shares.

Who is the biggest rare earth mining company in Australia?

Lynas Rare Earths ($LYC) is Australia's largest rare earths producer and the only pure rare earths miner amongst ASX rare earth stocks currently operating in the market. The total first-quarter production volume of Rare Earth Oxide (REO) was 4,348 tonnes in 2023. They also produce separated products like a Neodymium and Praseodymium (NdPr) concentrate.

What rare earth ETFs on the ASX can I invest in?

There are no ETFs that directly target ASX rare earth mineral shares. Products targeting the shift to renewables like Global X Green Metal Miners ETF ($GMTL) and BetaShares Energy Transition Metals ETF ($XMET) do provide exposure to rare earths miners. However, they account for relatively low proportions of the ETFs compared to commodities like lithium and copper.

What are the risks of investing in rare earths?

Rare earths aren't as unusual as their name suggests, but they are typically found in low concentrations that aren't always economically feasible to extract. This means that projects can be costly. Their chemical similarities make separation difficult and it often requires large amounts of chemicals. A project's geology will affect the final methods used and assessing the viability of these plans may be tough without technical knowledge in some cases.

Many rare earth projects also contain radioactive elements, which can lead to issues with permitting and often related to waste disposal concerns. The prices of individual rare earths can also vary considerably. Projects tend to emphasise their levels of NdPr, Dy and Tb as these tend to attract the highest premiums. On the other hand, the more geologically abundant minerals like cerium are less valuable and contribute less to overall project economics.

Are rare earth stocks a good investment?

There are concerns about the future supply levels of rare earths, especially due to growing demand for permanent magnets in EVs and wind turbines. A shortfall in supplies could lead to elevated prices for the minerals and help boost rare earth stocks. Some have also become worried about the level of control China has over the rare earths market, especially in terms of processing. Rising geopolitical tensions could have an impact on rare earth shares.

More resources:

✅ Looking for lithium mining companies in Australia?→

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Rare earth stocks FAQs

This does not constitute financial product advice nor a recommendation to invest in the securities listed. Past performance is not a reliable indicator of future performance. As always, do your own research and consider seeking appropriate financial or taxation advice before investing.