Labor may speed up tax credit as lithium miners buckle

Elouise FowlerReporter

Updated Aug 1, 2024 – 6.34pm,first published at 11.42am

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The Albanese government could bring forward the $17.6 billion critical minerals production tax credit after New York-listed Albemarle decided to slash nearly 40 per cent of its workforce and close half of its lithium processing capacity in Western Australia.

The world’s largest lithium producer will shed 300 jobs as part of a radical downsizing in WA in the latest setback for Australia’s struggling critical minerals sector.

Albemarle CEO Kent Masters visits the Kemerton lithium hydroxide plant in 2022. Tony McDonough

Lithium is in a bear market as a result of softer-than-expected electric vehicle demand meeting an oversupply of the raw material, as explorers chased historically prices by bringing new mines online.

Its woes are exceeded by the pain in the nickel industry, where a glut fuelled by low-cost Indonesian output has caused about 7000 job losses in WA since last year. Even Fortescue will axe 700 jobs this month as its green hydrogen dream takes longer to be realised.

The cuts come barely 14 months after Albemarle vowed to spend billions on building a third and fourth processing unit – known as trains – at Kemerton to accompany trains 1 and 2 built last year. The Kemerton hub will now feature just one processing unit, which until now has failed to reach nameplate capacity.