Despite describing China’s state-owned Northern Rare Earths as a “perfect case study” in scaling rare earth metal production, Lynas Rare Earths chief executive Amanda Lacaze said emulation is not appropriate for the Australian context.
The comments were made during a Committee for the Economic Development of Australia (CEDA) panel about using science and technology to innovate and promote economic growth.
She spoke alongside DeepTech startup HydGene Renewables’ founder and chief executive Louise Brown and Tech Council of Australia chief executive Kate Pounder.
Ms Lacaze said that 30 years ago the Chinese state-owned Northern Rare Earths in Inner Mongolia was “anointed by the government as the lead company in the rare earths industry”, a plan that took a “generational approach”.
The country started from a situation where “all the downstream [resource] manufacturing was outside China.” But today most of this takes place within China.
“[Northern Rare Earths] are today, fully integrated from mine to advanced motor. They have a research institute with 100 PhDs in rare earths. They have all of the interim steps, but they didn’t have that 30 years ago and they built them sequentially one by one,” Ms Lacaze said.
She stated that copying this practice may not be suitable in the Australian context given the federated nature of government and the nation’s “very individualistic culture” that doesn’t put the “good of the many as more important than the good of the individual as a starting point”.
She added that “we have to find a way to progress with which we’re comfortable but at the same time, you need to recognise what are the things that might handicap our ability to get there”.
Northern Rare Earths was also expected to lead the development of IP and share that with other firms in China. Ms Lacaze argued that to create scale IP needs to be shared more readily and said there are policy opportunities to move towards a situation “where we don’t jealously protect our own IP”.
For Ms Lacaze, another key opportunity to scale is to ensure mining regions have guaranteed access to infrastructure including access to water, renewable microgrids, and reagents. This would drive co-location of a range of processing facilities including rare earths, lithium, and copper.
She also highlighted that critical minerals are “really just [the] names of minerals where there’s a dominant supplier from somewhere that we don’t much like”.
Regarding the commercialisation of research, Ms Brown said that the biggest challenge for a prospective academic entrepreneur is probably extracting IP from their university.
“Universities are very slow, they don’t like risk, they’re not understanding that a patent is not a commercial product, and the path is long. So that is a very slow process and hats off to anyone in this room that has ever extracted IP out of a university,” she said.
“We have to rethink our approach to IP because…it’s not valuable until we’ve done something with it.”
While some universities are more open to supporting their startups by giving them access to infrastructure, helping bring staff onboard, or partnering with the firms directly, Ms Brown said that some have “just not appreciated what needs to go into building new industries”.
Ms Brown also noted that labelling the period between spinning out research into a startup and generating revenue as a ‘valley of death’ is not encouraging to academics who may have otherwise comfortable jobs.
She said its currently not attractive to academics to “fight with the university for 12 months” for their IP only to embark on a valley of death. Rather, she believes it is a valley of opportunity and should be embraced as such.
“We need to find people to go on that journey with us, we have to learn from that. And a lot of startups will fail. I mean, that’s a fact. But we’re growing an ecosystem, we’re skilling up new workers, we’re learning and we collaborate. It’s an unbelievably collaborative industry and space to be in.”
Speaking on preparing students for STEM jobs of the future, Ms Brown noted that it can be difficult to predict what skills will be needed.
“Even coming from the academic sector, I don’t think we know really what those jobs of the future look like and we’re still trying to work out how to train students for those jobs, let alone trying to tell the high school careers adviser where you should send these students,” Ms Brown said.
“We have things like good internship placements into industry now and we need those programs to continue, we need industry partners to take on these students to show them what it looks like. These programs come and go, so I think what we’ve got to do is…when we’ve done well, don’t just keep a program, grow it.
“We seem to go through cycles of programs, it’s like the CSIRO ON program, it was there, it was successful, and then the funding stopped. It’s back, but where is the certainty in the plan of these programs that are going to support this big mission?”
Ms Pounder called for more attention to be placed on foundational policy settings that support innovation broadly in a sector agnostic way.
“That might be things like our [research and development tax incentive] settings, our foreign investment settings, it could be things like our venture capital tax arrangements, that’s been really instrumental in the last decade to getting more funding into these sectors…getting all those things right is essential to lift all boats,” Ms Pounder said.
She also called on the government to support high-potential sectors that are not being adequately funded by the private sector. In particular, she praised the federal government’s proposed $1 billion critical technologies fund
When asked by CEDA chief executive Melinda Cilento to comment on the difficulty in capturing “the imagination of the nation around science and technology”, Ms Pounder said it is the role of industry to “fire up people’s imagination and show them what’s possible”.
“Ultimately you have to connect it back to things that people care about…we need to talk about it also in terms that explains those benefits back to the community and why that was a good national investment and what the benefit to everyone would be,” Ms Pounder said.
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