An offtake agreement is a legally binding contract between a supplier and a buyer in which the buyer commits to purchasing a specified amount of the supplier’s future output(What Is an Offtake Agreement?, n.d.).
Mining offtake agreements aren’t just important—they’re essential, particularly for producers of critical and industrial metals that aren’t traded openly. These contracts, typically struck once a feasibility study is complete and before mine construction, guarantee a buyer for future output—saving companies the concern of finding a market for their product.
Securing an offtake agreement also makes it easier to obtain financing. Lenders and investors are more confident funding a project when a buyer is already lined up. In some cases, the buyer may even provide upfront capital to help move the project forward, though this isn’t always the norm(success, 2024).
Offtake agreements are about long-term vision, linking miners and end-users in a strategic partnership. What are the key terms you would prioritize in an offtake agreement to ensure a project’s long-term success and resilience? Let’s discuss!
References:
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success, Y. trusted source for investing. (n.d.). What is an Offtake Agreement? | INN. Retrieved August 12, 2025, from https://investingnews.com/daily/resource-investing/what-is-an-offtake-agreement/
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What is an Offtake Agreement? (Updated 2024) | Nasdaq. (n.d.). Retrieved August 12, 2025, from https://investingnews.com/daily/resource-investing/what-is-an-offtake-agreement/?utm_source=nasdaq&utm_medium=syndication
