MELBOURNE, June 25 (Reuters) - Rare earth developer

Meteoric Resources will collaborate with a regional

department of Brazil's Minas Gerais state to explore the

production of rare earth magnets, the Australian company said on

Tuesday.

Meteoric is developing its Caldeira rare earths deposit in

Minas Gerais. It is planning a demonstration plant to produce a

mixed rare earth carbonate and small volumes of separated oxides

that will start commissioning next year, and which will be

supplied to the magnet factory, CEO Nick Holthouse told Reuters.

"Brazil at a state and federal level are very clear about

their ambitions to build a rare earths supply chain," he said.

Aiming to break China's dominance of the supply chain,

mining giant Brazil is forging ahead to build a rare earths

industry as Western economies push to secure the metals needed

for magnets used in green energy and defence.

Meteoric has signed a preliminary agreement that includes

raw material supply to the Lab Fab permanent magnet facility for

the pilot production of rare earth magnets, it said in a filing

to the Australian stock exchange.

Lab Fab is a permanent magnet technology developer backed by

Minas Gerais that aims to stimulate the industry to scale up to

produce magnets for car manufacturers, electric motors and wind

turbine industries.

It is the first permanent magnet facility in Latin America

and will begin operations later this year. It will have an

initial capacity of 100 tonnes of permanent magnets per year

once, with plans to double capacity within three years.

Meteoric has a preliminary deal with Canada's Neo

Performance Materials ( NOPMF ) to supply its Estonia plant for

25-30 pct of its production, when it starts in the second half

of 2027, and has also been speaking with automakers or original

equipment makers (OEMs) for new supply deals.

"We do need to secure some more supply agreements. We are

constantly talking to offtakers and OEMs so there's multiple

opportunities we are developing in the background," Holthouse

added.

Meteoric also been awarded $250 million in preliminary

support from the U.S. Export-Import Bank (EXIM).