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Yahoo
5 hours ago
- Business
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As Albanese returns, what next for Australia's mining and minerals?
When Anthony Albanese, leader of Australia's Labor Party, secured his second term as prime minister in May of this year – the first Labor leader to do so since Bob Hawke, who served three terms from 1983 to 1991 – world leaders were quick to congratulate him. But did Australia's mining industry, a sector critical to the nation's economy, do the same? Just a few days before the election, Albanese made his intentions around critical minerals clear via a statement on his website. If elected, his government promised to 'pursue Australia's national interest and boost our economic resilience by establishing a Critical Minerals Strategic Reserve'. 'In a time of global uncertainty, Australia will be stronger and safer by developing our critical national assets to create economic opportunity and resilience,' stated Albanese. 'I will ensure that Australia continues to produce and benefit from the resources that are essential to our national interest.' The strategic reserve will see the federal government commit to entering contracts to purchase, or obtain options over, key critical minerals, which will likely give Australia's national government some leverage in relation to critical minerals as geopolitical tensions increase. The government will make an initial investment of A$1.2bn ($767m), including through a A$1bn increase in the existing Critical Minerals Facility established in 2021, taking the total investment in the facility to A$5bn. Australia is home to some of the largest critical mineral deposits on Earth. In 2024, government agency Geoscience Australia was pledged A$566m by the previous Albanese government to map out the nations' critical minerals over the next ten years and identify a strategy to develop them. Identified as crucial to developing infrastructure in everything from renewable energy to defence and communications, these critical materials are already believed to be abundant in Australia. However, Geoscience figures suggest more than 80% of the country remains under-explored. As such, the country 'is uniquely placed to meet the needs of increasing global and domestic demand, while the size and sophistication of our mining industry allows us to take maximum advantage of these resources', Albanese says. The reserve will create two new mechanisms: national offtake agreements, with the government taking agreed volumes via a voluntary contract; and selective stockpiling, with the government establishing stockpiles in Australia of certain key critical minerals. The reserve 'will generate cash flow from sales of offtake on global markets and to key partners [and] accumulate stockpiles of priority minerals when warranted by market conditions and strategic considerations, but it is anticipated that these will be modest and time-limited in most cases'. Resources Minister Madeleine King also says that the reserve, 'combined with production tax credits and the expansion of the Critical Minerals Facility, shows the Albanese government is taking the development of an Australian critical minerals industry seriously'. King, who is also Minister for Northern Australia, was re-appointed to the role on 13 May 2025. The Critical Minerals Production Tax Incentive (CMPTI) – passed into law in early 2025 – is a scheme intended to support the critical minerals industry and promote downstream processing in Australia. It offers a refundable tax credit on 10% of eligible costs associated with the processing of certain critical minerals between July 2027 and the end of June 2040. The Australian Government has two lists of minerals that are important for the nation's modern technologies, economies and national security: a critical minerals list containing 31 substances including cobalt and lithium; and a strategic materials list containing aluminium, copper, phosphorus, tin and zinc. The minerals on these lists support Australia's 'transition to net-zero emissions, advanced manufacturing, defence technologies and capabilities, and broader strategic applications', according to its Department of Industry, Science and Resources. Albanese's Government will now be able to carry on with its overarching Future Made in Australia policy – essentially an attempt to enhance the benefits of net-zero and energy transition policies. The creation of the critical reserve is central to that, along with a A$750m commitment to develop new low-emissions technology, and A$1bn to boost green iron manufacturing and supply chains. A statement from Andrew Forrest, executive chairman and founder, Fortescue, claims the return of Albanese 'sends a clear and unequivocal message: Australians will back and support policies that recognise the economic opportunities which come from acting on the existential threat of climate change'. Forrest continues that the government's commitments, 'including the Future Made in Australia plan, the Capacity Investment Scheme, the Hydrogen Production Tax Incentive and the Green Iron Fund, provide a strong foundation for a green energy future'. Australia is likely trying to position itself as a green iron manufacturing powerhouse, with the A$1bn fund boosting green iron manufacturing and supply and helping to unlock substantial levels of private investment. 'Green iron can be the biggest industry Australia has ever built,' adds Forrest, so 'let's start in the Pilbara this decade, with investment, markets and skills'. Pilbara is home to Fortescue's Green Metal Project, which is expected to produce more than 1,500 tonnes per annum of green metal, with first production anticipated in 2025, according to the company's website. The plant will use green hydrogen in a reduction furnace to convert iron ore into sponge iron, revealed the company. Soroush Basirat, energy finance analyst, global steel at the Institute for Energy Economics and Financial Analysis, was also hopeful Albanese would help the growth of Australia's high-grade magnetite mining sector, as a key feedstock for green iron production. 'The industry remains focused on hematite mining due to its higher profit margins, but this approach limits flexibility,' Basirat told Mining Technology. 'A transition to magnetite mining – better suited for producing high-grade ore – has yet to gain traction. Given the long lead times for magnetite projects (often a decade to become operational and deliver stable output), government support is essential to accelerate development.' Of Australia's total economic demonstrated resources of iron ore, just over 58.29 billion tonnes (bt), some 24.25bt is magnetite ore, according to 2023 research from Australia Minerals, a collaboration of Australia's federal, state and Northern Territory Government geoscience agencies. The research added that the 'projected demand for high-grade iron ore products has provided momentum for the recent development of magnetite deposits, such as the Iron Road Central Eyre project in South Australia and Fortescue Metals Group's Iron Bridge project in Western Australia. Basirat continues that while the government 'is backing green iron initiatives, significantly more effort is needed to establish even a single low-emissions ironmaking facility in Australia'. To remain competitive in the evolving global iron ore market, Australia must also act swiftly to diversify beyond hematite and invest in the future of high-grade, low-emissions iron production. 'Without action, Australia risks losing its competitive edge. Emerging competitors such as the Simandou [iron ore] mine in [Guinea], Africa, are set to enter the market and could claim a significant share by the end of the decade, challenging Australia's dominance, which has been largely built on lower-grade ores,' Basirat adds. There is an 'urgent need' to shift toward producing high-grade iron ore that is suitable for the direct reduced iron pathway, says Basirat, noting that this process is 'critical as steelmakers transition to more environmentally friendly technologies such as electric arc furnaces to replace the traditional, coal-based blast furnace-basic oxygen furnace method'. Australia's minerals sector is central to the nation's prosperity, says an early May statement from the Mineral Council of Australia (MCA), 'supporting over 1.2 million jobs, contributing more than A$455bn in export earnings last year, and playing a vital role in the global energy transition through the supply of critical minerals'. Tania Constable, CEO, MCA, added that she hopes the new government 'will place investment at the heart of its economic growth strategy [with a] strong focus on skills, training and workforce, ensuring that Australia has the capability and talent it needs to meet growing demand for critical minerals and resources'. Some key aspects of the policy are tax incentives for processing of critical minerals and production of hydrogen, as well as resources to assess the dangers of foreign investment in critical infrastructure, critical minerals and critical technology. The Association of Mining and Exploration Companies' CEO, Warren Pearce, welcomed the re-election, and publicly stated that his organisation is 'ready and willing to work constructively with the returned Albanese government to deliver the minerals and metals critical to Australia's prosperity and the global energy transition'. Pearce added that it is now time 'for action on key policy initiatives that will support long-term investment and drive Australia's international competitiveness, especially in critical minerals'. 'The exploration sector is struggling,' said Pearce, 'with investment extremely hard to come by, and this crucial cog in the wheel of mining industry needs clarity around the continuation of Junior Minerals Exploration Incentive (JMEI)'. The JMEI encourages investment in small minerals exploration companies that carry out greenfields mineral exploration in Australia, allowing eligible companies to generate tax credits by choosing to give up a portion of their losses from greenfields mineral exploration expenditure. Initially introduced in 2017, JMEI is currently funded until the end of June 2025. Rebecca Tomkinson, CEO, Chamber of Minerals and Energy Western Australia, sees the re-election of Albanese as a chance to streamline environmental regulations, with reform of 'environmental law long overdue, but any change must [offer] improving outcomes for both the environment and for business'. "As Albanese returns, what next for Australia's mining and minerals? " was originally created and published by Mining Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
ABC News
24-04-2025
- Business
- ABC News
Critical minerals in hot demand but governments have hard time getting industry off the ground
The phrase "critical minerals" has lodged itself in the election campaign this week, with Labor promising to set up a national "reserve". For those who are unfamiliar with it, it can seem a daunting subject, the list of minerals sounding like a high school chemistry test: lithium, vanadium, zirconium, tungsten, molybdenum, and so on. Even if the science is dense, the economics are simple. These elements are vital for all sorts of new technologies, making them hot property. But while the world wants them and Australia has plenty of them, we sell very little, with China dominating the market. Australian governments have been trying to change that by helping mining projects to get off the ground, so far without much success. But the Trump administration, which is eager to find critical minerals outside China, has renewed the effort. Can critical minerals be Australia's next mining boom, or is the government wasting money trying to pick a winner in a lost cause? Many buyers, not many sellers The minerals in question are critical for a variety of modern uses, including batteries, electric vehicles, LEDs, wind turbines, solar panels, artificial intelligence, and weapons. But China accounts for some two-thirds of the global market, both as an extractor of raw minerals and as a refiner. In the cobalt market, for example, it buys vast raw quantities from the Democratic Republic of the Congo and is a major producer. Photo shows close up of donald trump as he pouts his lips and raises his eyebrows Resources Minister Madeleine King says Australia has other buyers for critical minerals that interest Donald Trump, as the government continues "tough" tariff talks. The dominance creates a strategic risk for Western countries if economic "decoupling" with China should accelerate in the coming years. It has already shown a willingness to withhold the minerals in moments of diplomatic tension, as it did with Japan in 2010. But even without that, it makes the market volatile. China can use its position to exert control over the price, and the risk of some dramatic disruption to such a fragile supply chain makes it hard for new investors to know how they should price new projects. That means that, even as buyers are desperate for new markets, dangling opportunities for minerals-rich Australia, it can be hard to attract capital. For example, how should an investor weigh up the viability of a new Australian cobalt mine factoring in the risk of China using coercion or wielding its market power to dramatically change the price from its current levels? Grab bag of government billions This is where successive Australian governments have seen a role for intervention, to support projects in their early phase with subsidies or underwriting, in the hope that they will be viable once up and running. The Morrison government established a Critical Minerals Facility for investments like this, now worth $4 billion with Labor pledging another $1 billion. The Clean Energy Finance Corporation and the Northern Australian Infrastructure Facility also offer some critical minerals support, as does Labor's new National Reconstruction Fund. Some of Labor's new production tax credits are also earmarked for critical minerals. And the government also tries to play a role in making regulatory systems friendly to new investors, including considering how to balance environmental approval laws and any resistance from First Nations traditional owners to new mines. The latest Labor proposal is to offer voluntary agreements to critical minerals operations to buy some of their output, and to create a national stockpile (or "reserve") of the minerals, effectively underwriting mines by guaranteeing some demand. Selling ourselves to, but also competing with, our allies Labor's Resources Minister Madeleine King told the ABC's Radio National Breakfast the reserve would have a dual purpose; to boost Australia's domestic supply of the minerals and to boost its offering to other countries. "What it does is actually provides price certainty in a market [that] is extraordinarily opaque. It's very difficult to work in international markets in these minerals because of that opaqueness and also the fact that it is dominated by one supplier," she said. Photo shows A close up of Peter Dutton on the campaign trail. Peter Dutton denies changing his position on a popular tax break for people who buy an electric vehicle. Follow live. "So the intention here has always been that Australia just wants to compete in one of our natural advantages, which is our geology … [This] is one really important tool in making sure that happens." The Coalition proposes expanding the critical minerals list to include copper, zinc, uranium, aluminium, and bauxite, among others, but has called Labor's critical minerals credits ineffective and dismissed this latest move. Opposition resources spokesperson Susan McDonald said it was "an admission of policy failure" and showed the government was "laughably unprepared and late". Opposition Leader Peter Dutton said it was a "reheat and a rehash" and a reannouncement with no delivery. "But critical minerals are absolutely essential for us and for our partners, and whether that looks like an offtake agreement or whether it looks like an agreement to stockpile it to work with the US and the UK and Japan et cetera, we will work [out] all that detail in government." Critical minerals have also been a key bargaining chip in Australia's so-far unsuccessful attempts to secure an exemption from the Trump administration's sweeping tariffs. The Albanese government believed it was close to securing a deal last month, but saw it fall through as those in the White House pushing for a "no-exemptions" approach to tariffs won US President Donald Trump's ear. Mr Dutton has argued he could make a more enticing offer along similar lines. But while Australia seeks to win business in the US, the UK, the EU, Japan and South Korea, it also faces competition from those countries, several of whom have been investing in their own critical minerals operations, adding to a challenging landscape for whoever prevails in the election.
News.com.au
23-04-2025
- Business
- News.com.au
Anthony Albanese's $1.2bn pledge amid Donald Trump's tariff threat
The Albanese government will invest $1.2bn into Australia's critical minerals supply, which will likely play a major role in negotiating a tariff carveout from the Trump administration. This comes as Australian steel and aluminium imports have been hit with a 25 per cent levy, with other imports slapped with a 10 per cent tariff. Anthony Albanese will on Thursday announce plans to create a Critical Minerals Strategic Reserve to secure quantities of the select minerals that will be made available for domestic projects and select international partners. If re-elected, $1.2bn will be used to secure the initial resource stockpile, and purchases will be made according to strategic and market-conditions. These include elements like titanium, lithium, nickel and cobalt, which are essential for the production of mobile phones, computer chips, electric vehicles, solar panels and defence technologies. Altogether Australia has listed 31 critical minerals, and holds at least 4 per cent of the world's rare earth reserves. The Reserve is expected to be in operation from the second half of 2026, and a taskforce will be created to consult on the design and function of the reserve. Although the Prime Minister did not directly refer to the Trump administration in the announcement, he said the $1.2bn investment into Australia's critical mineral industry would help safeguard 'critical national assets' in 'time of global uncertainty'. 'The Strategic Reserve will mean Government has the power to purchase, own and sell critical minerals found here in Australia,' he said. 'It will mean we can deal with trade and market disruptions from a position of strength. Because Australia will be able to call on an internationally-significant quantity of resources in global demand. 'This will be a national asset and our Government will use it to advance Australia's national interest.' Resources Minister Catherine King said the boost to the industry would also drive industry and jobs in Western Australia, where Mr Albanese will spend Thursday campaigning. 'Critical minerals and rare earths and essential not only to reducing emissions but also for our security and the security of our key partners,' she said. 'While we will continue to supply the world with critical minerals, it's also important that Australia has access to the critical minerals and rare earths we need for a Future Made in Australia. 'The Strategic Reserve, combined with Production Tax Credits and the expansion of the Critical Minerals Facility, shows the Albanese Government is taking the development of an Australian critical minerals industry seriously.'
The Australian
23-04-2025
- Business
- The Australian
Anthony Albanese's $1.2bn pledge amid Donald Trump's tariff threat
The Albanese government will invest $1.2bn into Australia's critical minerals supply, which will likely play a major role in negotiating a tariff carveout from the Trump administration. This comes as Australian steel and aluminium imports have been hit with a 25 per cent levy, with other imports slapped with a 10 per cent tariff. Anthony Albanese will on Thursday announce plans to create a Critical Minerals Strategic Reserve to secure quantities of the select minerals that will be made available for domestic projects and select international partners. Anthony Albanese will make the pledge on Thursday. Picture: Mark Stewart / NewsWire If re-elected, $1.2bn will be used to secure the initial resource stockpile, and purchases will be made according to strategic and market-conditions. These include elements like titanium, lithium, nickel and cobalt, which are essential for the production of mobile phones, computer chips, electric vehicles, solar panels and defence technologies. Altogether Australia has listed 31 critical minerals, and holds at least 4 per cent of the world's rare earth reserves. The Reserve is expected to be in operation from the second half of 2026, and a taskforce will be created to consult on the design and function of the reserve. Although the Prime Minister did not directly refer to the Trump administration in the announcement, he said the $1.2bn investment into Australia's critical mineral industry would help safeguard 'critical national assets' in 'time of global uncertainty'. 'The Strategic Reserve will mean Government has the power to purchase, own and sell critical minerals found here in Australia,' he said. It comes amid Donald Trump's tariff announcement. (Photo by Brendan SMIALOWSKI / AFP) 'It will mean we can deal with trade and market disruptions from a position of strength. Because Australia will be able to call on an internationally-significant quantity of resources in global demand. 'This will be a national asset and our Government will use it to advance Australia's national interest.' Resources Minister Catherine King said the boost to the industry would also drive industry and jobs in Western Australia, where Mr Albanese will spend Thursday campaigning. 'Critical minerals and rare earths and essential not only to reducing emissions but also for our security and the security of our key partners,' she said. 'While we will continue to supply the world with critical minerals, it's also important that Australia has access to the critical minerals and rare earths we need for a Future Made in Australia. 'The Strategic Reserve, combined with Production Tax Credits and the expansion of the Critical Minerals Facility, shows the Albanese Government is taking the development of an Australian critical minerals industry seriously.' Jessica Wang NewsWire Federal Politics Reporter Jessica Wang is a federal politics reporter for NewsWire based in the Canberra Press Gallery. She previously covered NSW state politics for the Wire and has also worked at and Mamamia covering breaking news, entertainment, and lifestyle. @imjesswang_ Jessica Wang
7NEWS
23-04-2025
- Business
- 7NEWS
Federal election: Labor promises to launch critical minerals reserve in move for ‘national interest'
The Albanese Government has promised to establish a Critical Minerals Strategic Reserve that could be used as a bargaining chip in trade talks with US President Donald Trump. Minerals held by the reserve will be made available to domestic industry and key international partners, which would likely include the United States, with the mechanism and allocations to be determined by Government, should it be re-elected on May 3. Labor will establish the reserve in 2026 through national offtake agreements with commercial projects and selective stockpiling of key minerals. Labor says the primary consideration for entering into offtake agreements will be securing priority critical minerals for strategic reasons. The focus will be on a subset of critical minerals that are most important for Australia's national security and the security of our key partners, including rare earths. A re-elected Labor Government will make an initial investment of $1.2 billion into the reserve, including through a $1 billion increase in the existing Critical Minerals Facility. This will take total investment in the Facility to $5 billion. The prime minister said the timing is crucial given the ongoing global uncertainty. 'Australia will be stronger and safer by developing our critical national assets to create economic opportunity and resilience,' Albanese said. 'I will ensure that Australia continues to produce and benefit from the resources that are essential to our national interest. 'The Strategic Reserve will mean Government has the power to purchase, own and sell critical minerals found here in Australia. 'It will mean we can deal with trade and market disruptions from a position of strength. Because Australia will be able to call on an internationally-significant quantity of resources in global demand. 'This will be a national asset and our Government will use it to advance Australia's national interest.' The announcement will be made in Western Australia on Friday, Resources Minister Madeline King said critical minerals and rare earths are essential for reducing emissions and security reasons. 'While we will continue to supply the world with critical minerals, it's also important that Australia has access to the critical minerals and rare earths we need for a future made in Australia,' King says. 'The Strategic Reserve, combined with Production Tax Credits and the expansion of the Critical Minerals Facility shows the Albanese Government is taking the development of an Australian critical minerals industry seriously. 'And that means more investment and more jobs for Western Australia.' Peter Dutton has hinted at using critical minerals to negotiate with Donald Trump for a tariff exemption, but the Liberal leader is yet to reveal the exact details.
