Suvo Strategic Minerals Limited (ASX: SUV) has extended a major take or pay offtake agreement until February 2030. The agreement, valued at ~A$6.56M, covers a minimum order quantity, under a take or pay arrangement, of 8,750t of hydrous kaolin over a five-year period. The previous three-year deal covered 4,275t of hydrous kaolin.
The extended agreement includes a 25% annual increase in minimum order volumes, adhering to the take or pay arrangement. This is a significant increase compared to the previous three-year deal, which covered 4,275t of hydrous kaolin. The new agreement will commence in February 2025 and will operate under the same terms and conditions as the previous contract.
Executive Chairman Aaron Banks commented: “We are pleased to extend this take or pay Offtake Agreement with our valued customer, Chengcheng. As a result of winning new business, following an aggressive marketing campaign throughout China, with our local distribution partner, Chengcheng, we were able to increase the annual minimum order quantities in the Agreement by 25%,”
“The increase in demand from one of our major customers just last month and now another positive step forward with this Agreement, we anticipate significant growth in sales volumes in 2025. Furthermore, we anticipate further positive growth at the Pittong operations, which reported positive EBITDA and net profit, at project level, of A$0.51M and A$0.39M last quarter.”
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