Largo Inc. terminated its iron ore calcine sale agreement for up to 4.5 million tonnes after the counterparty failed to make the initial payment of US$2.9 million. The agreement, signed on January 20 2026, had a payment due date of January 30 2026 and a delivery schedule that would have begun after that payment. No calcine was delivered, and Largo retains full ownership of the inventory.
The company said the termination is not expected to materially affect its financial position, liquidity, or ongoing operations. The inventory remains bonded and is not yet recognized as revenue, so the loss of a potential sale does not immediately impact earnings. Largo is actively seeking alternative buyers to mitigate any working‑capital impact.
The decision follows a pattern of contract adjustments as Largo navigates a volatile vanadium market and seeks to optimize its asset portfolio. The company is also monitoring U.S. tariff developments on Brazilian vanadium, noting that a Supreme Court ruling struck down a 50% tariff and that lower tariffs of 10–15% could be reimposed. Largo’s bonded vanadium inventory in U.S. ports could be released if tariff conditions change, providing a potential upside.
Largo’s financial profile shows a current ratio of 0.5 and ongoing cash burn, prompting a US$60 million at‑market equity offering announced in January 2026. The company is ramping up production at its ilmenite concentrate plant to diversify revenue streams. Despite the termination, Largo’s broader operations remain focused on maintaining operational flexibility and managing exposure to market and contractual risks.
The company said, "Largo retains full ownership of the 4.5 million tonnes of calcine iron ore inventory and is advancing discussions with alternative potential buyers. The termination is not expected to have a material impact on the Company's financial position, liquidity, or ongoing operations." It also added, "Largo is assessing recent developments relating to U.S. tariff authority and assessing its operational flexibility, including its bonded inventories in U.S. Ports, to respond efficiently to potential changes in trade conditions."
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