Montreal-based Torngat Metals has struck a memorandum of understanding (MoU) with German company Vacuumschmelze (VAC) to pursue a long-term supply agreement for rare earth oxides.

The non-binding deal was signed in Berlin on Tuesday by Torngat Metals CEO Yves Leduc and VAC CEO Erik Eschen, in the presence of Canada’s Minister of Energy and Natural Resources Tim Hodgson and Germany’s Minister for Economic Affairs and Energy Katherina Reiche.

Both countries have been pushing to reduce reliance on China, which dominates the global rare earths industry, and to secure raw materials needed for technologies such as wind turbines, electric vehicles and defence systems.

“This MoU highlights our progress – not only in advancing project development, but also in forging the partnerships needed to build a resilient and diversified supply chain for rare earth permanent magnets,” said Leduc. “These critical minerals are central to advanced clean energy technologies, and we look forward to working with VAC to play a leading role in driving the transition.”

VAC, which describes itself as the sole Western producer of sintered rare earth permanent magnets, said the partnership would help it secure reliable access to terbium and dysprosium, elements essential to high-performance magnets.

“As the sole Western producer of sintered rare earth permanent magnets, VAC is at the forefront of securing a diverse and resilient supply chain for critical raw materials. The company is expanding our global capacities and moving upstream into strip casting and metal making, strengthening every stage of production,” said Eschen.

“Ensuring reliable access to terbium and dysprosium – elements essential to high-performance magnets – is the final step, and one that we are achieving through our strategic partnership with Torngat Metals. This commitment is essential to reinforce VAC’s strategic position and bolster the industrial base. In doing so, we can enhance the national security of our allied nations by ensuring the continuous availability of technology critical to our collective defence.”

Hodgson welcomed the move, saying it reflected Canada’s ambitions to become an “energy and critical mineral superpower”.

“The partnership between Torngat Metals and VAC marks a significant step forward in Canada’s efforts to build a secure and sustainable supply chain for rare earth elements,” he said.

“By advancing responsible development at Strange Lake and forging international collaboration with a global leader like VAC, Torngat Metals is helping to position Canada as a key contributor to the permanent magnet supply chain, and an energy and critical mineral superpower. This agreement reflects our shared commitment with Germany to reduce reliance on single-source supply chains and strengthen the resilience of critical mineral access worldwide.”

Torngat Metals is developing the Strange Lake rare earths project in northern Quebec, which it says is uniquely positioned to provide both light and heavy rare earths required for permanent magnets. The company is working with Indigenous communities and has pledged to minimise environmental impacts as it progresses development.