Sep 10, 2024 – 10.30pmListen to this article4 minNational governments would become more interventionist in funnelling investment into priority resources projects under the planned creation of a collective marketplace of major industrialised nations, including Australia, to mine, process and consume critical minerals.
As Resources Minister Madeleine King warns that foreign partners need to “lean in” to help develop Australian projects, the high-level talks seek to break China’s stranglehold on materials crucial to 21st-century technology, including military equipment.
Federal Resources Miniser Madeleine King says other countries need to “lean in” to invest in Australian critical minerals projects. Ross Swanborough
They are being framed around economic and national security, in recognition of an unhealthy dependency on China, which is positioned as both a major supplier and buyer of critical minerals.
China’s distortions of global nickel and lithium markets have been a wake-up call and built momentum for a sweeping agreement, according to government sources familiar with negotiations.
Australia and Canada are involved in the talks as major producers of critical minerals, while on the demand side, Japan, South Korea and the European Union, principally Germany and France, are represented. The US straddles both as a supplier and consumer of critical minerals.
AdvertisementOfficials feared premature disclosure of the talks would give China an opportunity to disrupt the creation of the network, but US National Security Adviser Jake Sullivan told The Sydney Morning Herald and The Age that he hoped to finalise arrangements before President Joe Biden’s term ended in January.
Securing supply chains
Ms King will tell a Minerals Council of Australia event on Wednesday that Australia is working with the US and foreign partners to ensure “specific strategic projects get the support they need”, singling out rare earths as vital for military capabilities.
“Securing these supply chains is imperative not only for our future economic diversity and sovereign capacity but also for our security and that of the region,” she will say, according to speech notes.
“Developing our critical minerals sector is not a ‘nice to have’ to augment iron ore, coal and gold mining. It’s a strategic imperative.”
While Ms King will not name China, she will say critical minerals and rare earths markets face additional structural challenges on top of the natural boom and bust cycles all commodities experience.
“The critical minerals sector is facing headwinds. The warnings given for years about the associated risks with thin markets and concentrated supply chains are now being realised,” she will say.
“We are seeing the very real consequences here in Australia.
“Facilities that have been world leading in processing battery-grade ingredients such as lithium hydroxide and nickel sulphide have gone into closure because massive oversupply is distorting markets which are opaque and subject to manipulation.”
While not intended to create a cartel for the buying and selling of critical minerals, if successful the talks are expected to lead to much greater co-ordination and a faster start-up for projects, including identification of key minerals and prioritising projects to meet this demand.
What [miners] need is a way to raise capital and have access to technology for processing and access to markets to sell back into.
— John Coyne, Australian Strategic Policy Institute
This could lead to government-owned banks and finance agencies becoming more active in lending money to get projects off the ground, in addition to incentives and subsidies that governments offer, such as Australia’s production tax credits, that are meant to spur investment.
In recent years, the US and European and Asian countries have signed bilateral memorandums of understanding and other agreements with Australia on developing critical mineral projects.
But the latest talks have recognised the need to co-ordinate investment to take on China and get projects under way, rather than competing against each other, government sources said.
Australian Strategic Policy Institute analyst John Coyne said a “mini-lateral” grouping of a handful of governments was the best way to concentrate efforts on scaling up critical minerals production in the West to challenge China’s dominance.
“Normal market forces won’t resolve this,” Mr Coyne said. “What miners need is not necessarily tax breaks or subsidies. What they need is a way to raise capital and have access to technology for processing and access to markets to sell back into.”
Mr Coyne said China’s grip on critical minerals included investing heavily in Indonesian nickel projects to flood the global market to hurt competitors, and zealously guarding its intellectual property for processing.
“They are doing it across multiple levels of the value chain, not just digging it up,” he said.
Sign up nowThe biggest stories in business, markets and politics and why they matter.
Need to know. Our daily reporting, in your inbox.
Andrew Tillett writes on politics, foreign affairs, defence and security from the Canberra press gallery. Connect with Andrew on Facebook and Twitter. Email Andrew at andrew.tillett@copyright linkReports
Clean Energy - the bumpy transition
This special report looks at how Australia is tracking to meet net zero goals, and the new technology that can help us get there.
Sponsored
Andrew TillettForeign affairs, defence correspondentSep 10, 2024...
-
- There are more pages in this discussion • 913 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Add WA1 (ASX) to my watchlist
 (20min delay)
|
|||||
|
Last
$13.50 |
Change
-0.480(3.43%) |
Mkt cap ! $875.6M | |||
| Open | High | Low | Value | Volume |
| $13.99 | $14.03 | $13.42 | $1.920M | 140.8K |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 1 | 771 | $13.50 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $13.56 | 895 | 2 |
View Market Depth
| Last trade - 16.10pm 18/10/2024 (20 minute delay) ? |
| WA1 (ASX) Chart |