“This is an acknowledgement of Australia’s strategically important role in the development of new technologies, defence capabilities and renewable energy infrastructure,” CEO Tania Constable said in a statement.<\/p>\n
“It confirms Australia’s fundamental role in the global supply chain of the very minerals, materials and rare earths that the world requires.”<\/p>\n
Tania Constable said the mining industry is committed to safety. (AAP: Lukas Coch)<\/p>\n
Ms Constable said Australia was well-positioned to meet the growing needs of its long-standing partners in Asia, the US and Europe.<\/p>\n
She added that the partnership came “at a time when investment is urgently required to unlock the nation’s next chapter of prosperity in critical minerals”.<\/p>\n
Analysts at UBS agreed the “landmark” framework “continues the way for a re-emergent \u2026 rare-earths supply chain” outside of China.<\/p>\n
However, the investment bank analysts did point out a lack of detail in the announcements, saying “project specifics are so far elusive”.\u00a0<\/p>\n
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Monazite is a mineral used in the rare earth industry to extract elements such as cerium, lanthanum, and neodymium. (Reuters: Maxim Shemetov)<\/p>\n
Critical minerals stocks rocketed higher when the Australian share market opened on Tuesday, just hours after the agreement was inked, led by those specifically flagged for further investment, including Alcoa and Arafura Rare Earths.<\/p>\n
However, by the close of trade on Tuesday, investors had taken profits on some of the stocks, leading to a mixed finish.<\/p>\n
Alcoa Corp surged 7.49 per cent to $59.68 while Lynas Rare Earths plummeted to $18.96, down by 7.56 per cent.\u00a0<\/p>\n
Meanwhile, South32 lifted 5.1 per cent to $3.28, Pilbara Minerals gained 5.6 per cent to $2.86, BHP rose 2.6 per cent to $44.26, and Mineral Resources climbed 2.5 per cent to $42.41 \u2014 all helping the ASX200 Materials sector to a fresh record high, according to IG market analyst Tony Sycamore.<\/p>\n
Loading…How have critical minerals companies reacted?<\/p>\n
According to the deal, two strategically significant projects \u2014 the Alcoa-Sojitz project in Western Australia and Arafura’s Nolan project in the Northern Territory \u2014 have been prioritised.<\/p>\n
The planned gallium plant, a joint venture between Alcoa and a Japanese firm, will receive up to $US200 million from the Australian government, as well as an unspecified amount from the US.<\/p>\n
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Gallium is a critical mineral essential to technology, especially the semiconductor and defence sectors. (Commons: Foobar<\/a>; Gallium crystals<\/a>; licence<\/a>)<\/p>\n Japan will fund the Sorjitz corporation’s half of the project, which is projected to supply up to 10 per cent of the world’s gallium, a critical input for semiconductors and advanced defence technologies.<\/p>\n Albanese and Trump ink deal for ‘dominance’ of critical minerals<\/a><\/p>\n Donald Trump and Anthony Albanese have inked a deal for “critical mineral and energy dominance” in a new partnership that will tip billions into mining projects in the US and Australia.<\/p>\n Gallium production is concentrated in China, and market controls have heightened interest in establishing alternate supply chains.<\/p>\n UBS analysts wrote that they were “buoyed by comments that other countries [including Japan with its magnet processing capabilities] would also be involved” in the projects funded by the investment deal.<\/p>\n Alcoa boss William Oplinger said in a statement he welcomed “the opportunity to support both nations in progressing a new source of gallium”.<\/p>\n “The investment support from the US and Australian governments underscores Alcoa’s role in supporting the development of the critical mineral supply chain, and the importance of our Australian operations not only to the aluminium industry, but also as key to manufacturing, technology, and defence industries.”<\/p>\n The parties are targeting 2026 for the final investment decision and production.<\/p>\n Meanwhile, Arafura Rare Earths told the market it received conditional approval from the federal government for an equity investment of up to $US100 million to progress the project.<\/p>\n The US is considering up to $US300 million in financial support.<\/p>\n “Our nascent rare earth sector is not a prospect, it is an imperative,” Arafura CEO Darryl Cuzzubbo said. Darryl Cuzzubbo says rare earths are forecast to grow significantly over the next three decades. (AAP: Dominic Giannini)<\/p>\n “Since April, we have seen unprecedented disruptions to global trade and supply chain vulnerabilities exposed.<\/p>\n “By pioneering thoughtful supply chain diversification today, we are securing the foundational, long-term solutions required to meet the growing demands of tomorrow.”<\/p>\n Arafura said the project would produce 5 per cent of global rare earths once up and running.<\/p>\n Despite its share price ending flat on Tuesday, the company’s shares soared by 300 per cent in the year to date to $0.48 per share.\u00a0<\/p>\n Deal about processing, not just mining<\/p>\n A number of Australian companies have been sent Letters of Interest totalling more than $US2.2 billion ($3.4 billion) from the Export-Import Bank of the United States.<\/p>\n They include:<\/p>\n Arafura Rare EarthsNorthern MineralsGraphinexLatrobe MagnesiumVHMRZ ResourcesSunrise Energy Metals Australian Prime Minister Anthony Albanese and US President Donald Trump have committed to investing at least $US1 billion each over the next six months. (AAP: Lukas Coch)<\/p>\n Adam Handley, the chair of Northern Minerals, told ABC Radio the deal was paramount.<\/p>\n “It is a significant and timely step, which will accelerate the development of Australia’s highly strategic rare earths supply chain and further bolster the western world’s concerted efforts to develop independent critical minerals, including heavy rare earths supply chains,” he said.<\/p>\n Northern Minerals’ wholly-owned Browns Range project, which produced dysprosium and terbium, aimed to meet about 8\u20139 per cent of the global demand when it was operating at full scale, according to Mr Handley, targeting the first production of dysprosium and terbium in 2028, subject to funding.<\/p>\n How we use critical minerals<\/a><\/p>\n Rare earths are found all over the globe, but as technology advances they’re becoming part of our everyday lives.<\/p>\n The CEO pointed out that the agreement was not just about mining but also processing.<\/p>\n “We will semi process,” he said.<\/p>\n “We’ll produce a dysprosium and terbium concentrate called xenotime concentrate, and we will then ship that down to Iluka refinery \u2026 Iluka will then do the extra processing to produce an oxide to sell to the market.”<\/p>\n Iluka Resources is building Australia’s first fully integrated rare earths refinery, which will have the capability to produce both light and heavy rare earth oxides.<\/p>\n Iluka’s share prices dropped to $7.55, down 0.1 per cent, when the market closed on Tuesday.\u00a0<\/p>\n Work needed to develop market, experts warn<\/p>\n Despite the money set to be thrown at the sector under the deal, some experts have raised concerns that more needs to be done to develop the market for Australian minerals by investing across the supply chain.<\/p>\n Lian Sinclair, an economic geographer at the University of Sydney, said more support was needed for Australian miners.<\/p>\n ‘Without investment in refineries and magnet production in allied countries, Australian miners will continue to either sell into or be outcompeted by Chinese domestic industry,” Dr Sinclair said.<\/p>\n Australia has abundant deposits of critical minerals. (Supplied: Lynas Corporation)<\/p>\n “Apart from Australian rare earths mining company Lynas, which sells into the Japanese market, miners are struggling to find potential international buyers.<\/p>\n “US, Europe and South Korea need to focus investment in their ‘midstream’, if they want to ‘de-risk’ EVs and wind turbines from Chinese rare earth supply.”<\/p>\n At the White House, the US president alluded to a potential supply influx, saying “about a year from now you’ll have so much critical minerals and rare earths you won’t know what to do with them”.<\/p>\n<\/p>\n
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