Resources minister says US has better rare earths options in Australia
Resources Minister Madeleine King says the US would be better served focusing on rare earths supply from Australia, rather than chasing projects in Greenland and Ukraine.
Resources Minister Madeleine King says the US would be better served focusing on rare earths supply from Australia than chasing projects in jurisdictions like Greenland and Ukraine.
Ms King joined business leader Amanda Lacaze in casting doubt Donald Trump’s rare earths strategy, which has focused on gaining control of Greenland and assets in Ukraine since his return to the White House.
In flexing his geopolitical muscle, Mr Trump has provoked a backlash in Europe over designs on Greenland and by making support for the Ukraine in its war with Russia conditional on access to rare earths and other minerals projects.
Ms King said the US President should look to secure supply from Lynas and a host of taxpayer-backed rare earths projects in Australia.
“The US administration has other options (in Australia),” she said.
“So, while they can go right ahead and pursue what they’re doing with Ukraine or with the talk about Greenland, what my position would be is that we have a string of rare earth projects right across the country from west to east.
“Australia presents an opportunity for us both with our mineral wealth that might be a somewhat more stable and welcoming environment to extract rare earths than some others.”
Ms King pointed to Lacaze-led Lynas Rare Earths, the world’s biggest non-China supplier of rare earths, as an obvious and reliable supplier to the US.
Asked about the prospect of Ukraine becoming a major supplier to the US in line with the Trump deal on Wednesday, Ms Lacaze referenced various “thought bubbles” she had heard about rare earths, including mining on the moon.
Ms Lacaze maintains the best way for the US to secure rare earths is to buy it from Lynas, which has the world’s top mine in WA and a processing plant in Malaysia.
Ms King said the US could also look to supply from projects being developed by Iluka Resources in WA, Arafura Rare Earths in the Northern Territory and Australian Strategic Materials near Dubbo in NSW.
The three projects have received about $2.65bn in taxpayer support, including $1.65bn for Iluka to build Australia’s first integrated rare earths refinery.
Ms King noted Australian Strategic Materials received a non-binding and conditional funding commitment of up to $US600m from the Export-Import Bank of the US (EXIM) under the Biden administration.
She said increased US funding for Australian rare earths projects remained possible given work between Australia and the US on boosting critical minerals supply chains to combat China’s dominance began under the first Trump administration.
“It’ll be the US administration that decides what it wants to do, of course, but this is a stable country with very known and well explored deposits of critical minerals and rare earths, and with the capacity to mine,” Ms King said.
In December, the Albanese government gave itself the power to prevent sales to China in stumping up an additional $400m to help Iluka complete its refinery at Eneabba in WA.
The increased funding was subject to Iluka only securing offtake agreements satisfactory to the government, which has already intervened several times to prevent China extending its rare earths dominance to assets in Australia.
Ms King said the offtake clause was about ensuring the government met its supply chain objectives in rare earths and critical minerals when providing taxpayer support.
She admitted being worried about the future of two lithium hydroxide plants in WA, one owned by New York-listed Albemarle and the other by China’s Tianqi and its ASX-listed partner IGO Limited.
The two plants are set to benefit from the production tax credit legislation that recently passed into law if they survive, The Coalition has vowed to scrap the tax credits if it wins this year’s election.
Ms King said the operators of WA’s lithium hydroxide plants were struggling in an opaque market where pricing was manipulated through oversupply out of China.
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