As global markets adjust to shifting trade tariffs—especially from the U.S.—Chilean mining group CAP is reconfiguring its growth strategy. At its recent shareholders’ meeting, the company highlighted a stark contrast between short-term risks and long-term opportunities, especially through its growing partnership with Aclara Resources in the rare earths sector.
Trade Pressures from China
CAP executives acknowledged that China remains a critical market, especially for its iron ore operations. Compañía Minera del Pacífico (CMP), CAP’s iron ore arm, sold 76% of its production to China in 2024, down slightly from 79% in 2023. However, this concentration raises concerns amid growing global trade tensions.
“A large share of our exports go to China, and a slowdown in Chinese construction or demand would directly impact us,” said CEO Nicolás Burr.
“Iron ore prices have already dropped 7% since new tariffs were announced.”
To mitigate this, Burr said the company is doubling down on cost reduction strategies, especially within its mining operations, while maintaining cautious outlooks on pricing and operational efficiency.
$275 Million Investment Plan for 2025
CAP plans to invest approximately US$275 million in 2025, focusing primarily on restarting Phase 5 of the Los Colorados Mine, which has been suspended since October.
Betting Big on Rare Earths: Penco and Brazil
The most optimistic outlook for CAP comes from its joint venture with Canadian company Aclara Resources. In 2024, CAP acquired a 20% stake in the Penco Module, Chile’s first rare earths project, located in the Biobío Region. Additionally, CAP’s stake in Aclara gives it indirect ownership in the Carina project in Brazil.
“Heavy rare earths like dysprosium and terbium, and light ones like neodymium and praseodymium, are crucial for energy tech, electronics, and chip manufacturing,” Burr noted.
“In Penco, we have a 1:3 ratio of heavy to light rare earths, and in Carina it’s 1:6. These are world-class ratios.”
According to CAP Chairman Juan Enrique Rassmus, the potential is transformational:
“Aclara could nearly double global heavy rare earth production outside of China. That’s the scale of what’s at stake between Chile and Brazil.”
He emphasized that, amid a global crisis, rare earths offer a massive growth window:
“What we’re doing with Aclara is a bright spot in a very challenging world. We closed the deal in February, and by April, we’re already making headlines.”
A New Corporate Image
Reflecting its strategic pivot, CAP unveiled a new corporate logo on the same day—featuring hues inspired by rare earth minerals and clay.
“The new color palette represents innovation and integration across our companies. The clays from Penco match these tones almost exactly,” Burr added.