China’s Gallium Ban Spurs Axel REE’s Strategic Caladão Discovery

A Landmark Gallium Discovery in Brazil

Axel REE Limited (ASX, AXL) has announced a maiden inferred mineral resource estimate (MRE) for gallium at its flagship Caladão Project in Minas Gerais, Brazil. The estimate, completed by SRK Consulting, outlines 100 million tonnes of lateritic soil hosting gallium at an average grade of 42 parts per million (ppm), equating to approximately 4.2 kilotonnes of contained gallium metal. This positions Caladão as one of the world’s largest non-alumina/bauxite gallium deposits, a rare find given gallium’s typical association with bauxite processing.

The resource is delineated at a 35ppm cutoff grade and is confined to a lateritic horizon averaging about 10 meters in depth. The mineralised zone at Area A spans roughly 33 kilometers, with an adjacent Area B offering an additional 58 kilometers of mineralisation yet to be fully incorporated into the resource estimate, suggesting significant upside potential.

Strategic Importance Amid Global Supply Constraints

Gallium is a critical metal integral to advanced technologies including semiconductors, 5G communications, radar, aerospace, and green energy applications. Notably, China controls approximately 94% of global gallium supply and recently imposed an export ban effective December 2024, disrupting global markets and driving gallium prices to around US$366,000 per tonne for high-purity material.

Axel’s discovery in Brazil’s Lithium Valley; a Tier 1 mining jurisdiction with established infrastructure such as sealed highways, low-cost power, and proximity to ports; offers a strategic alternative supply source. The Caladão Project’s location near existing lithium operations further enhances its logistical advantages.

Robust Exploration and Metallurgical Foundations

The resource estimate is supported by an extensive drilling campaign comprising 211 holes totaling nearly 3,900 meters, including auger, channel, and diamond drilling. Geological modelling and grade estimation employed advanced software and geostatistical methods, ensuring a reliable inferred classification consistent with JORC Code standards.

Metallurgical testwork conducted at ANSTO laboratories has demonstrated promising gallium recoverability using acid leach processes, alongside encouraging results for rare earth elements (REE) extraction from ionic adsorption clays. The company is progressing a maiden REE resource estimate, expected shortly, which could further enhance the project’s value proposition.

Looking Ahead, Expansion and Development

Non-Executive Chairman Paul Dickson highlighted the significance of the maiden resource, emphasizing the deposit’s scale and the potential for further expansion in Area B. With only 20% of the mineralised area drilled to date, Axel remains optimistic about the Caladão Project’s growth trajectory and its emerging role as a leader in critical metals essential for the clean energy transition.

As global demand for gallium and REEs intensifies amid geopolitical tensions and supply chain vulnerabilities, Axel’s Caladão discovery could become a pivotal asset in diversifying supply and supporting advanced technology sectors worldwide.