Australian and US government officials will hold high-level discussions in Washington later this year to develop a critical minerals action plan in an effort to mitigate risk associated with growing geopolitical tensions.
To coincide with Prime Minister Scott Morrison’s meeting with US president Donald Trump last week, a number of new plans for cooperation on science and technology were unveiled between the US and Australia, including on the extraction and processing of rare earth minerals and building lithium batteries.
These announcements accompanied the big reveal that Australia is to participate in the US government’s major Moon to Mars program.
The two countries would work together to produce a rare earth minerals plan in order to reduce reliance on China for the supply of the vital commodities, which are used to in the manufacture of smartphones, computer chips, solar panels, electric vehicles and a range of defence technologies.
Mr Morrison made an agreement with Mr Trump to hold senior discussions in Washington in November to develop a critical minerals action plan and increase the trade in rare earths between the US and Australia.
Australia has large supplies of nearly every critical mineral, with global demand for the vital resource rapidly growing due to their use on emerging high-tech applications.
China also holds large reserves of these critical minerals, but there are concerns that China could restrict shipments due to the ongoing trade war with the US.
The deal between the US and Australia is all about the need to secure a stable and reliable supply of critical minerals, especially for new defence technologies such as weapons guidance systems and various electronics used in the field.
“We share a concern about making sure that our supply of rare earths and critical minerals are secure,” the Trump administration said in a statement.
“That’s something that both countries have a very, very pronounced interest in.”
“We are looking at different ways in which we can pool our expertise and our research to make sure that there’s a stable and secure global market that’s not easily disrupted by shocks and outside influences.”
The plan could include the development of new mines in Australia and further trade between the two countries. China currently controls at least 80 percent of the global trade in critical minerals.
Earlier this year, the federal government developed its own Critical Minerals Strategy which outlined a policy framework for the industry and how to attract investment and capitalise on the wealth of the resources.
The strategy said the relative scarcity of the minerals make them a valuable commodity, and at risk of being disrupted by geopolitical tensions.
“Many countries with specific economic and industrial development requirements are starting to take a more strategic approach to ensure security of supply of these minerals,” the report found.
The report said Australia was well placed to capitalise on the growing demand for these rare earth materials.
During his visit to the US, Mr Morrison also secured an agreement for further collaboration on lithium-ion recycling with the US.
Australia currently has the third largest reserves of lithium and is its largest producer. The new agreement with the US follows the opening of a new round of Cooperative Research Centre project funding earlier this year targeted specifically at critical minerals.
Up to $20 million is on offer through the funding round, which is aimed at strategically important minerals such as lithium and rare earth minerals.
The Coalition also has a longer-term aim of building Australia’s lithium-ion manufacturing capability after an Austrade report revealed a once in a generation opportunity to create a production industry.
A report by the Office of the Chief Scientist in mid-2018 found that Australia produced more than 40 percent of the world’s lithium supply.
Mr Morrison’s trip to the US also saw agreements for enhanced cooperation through joint senior-level dialogues on advancing frontier technologies, a deal to see the CSIRO join the US government-funded ReCell Centre’s industrial advisory council and news that the National Science Foundation will send a delegation of subject matter experts to Australia to work with the local science communities to identity projects of mutual interest.
Resources minister Matt Canavan will visit Korea and Japan this week to discuss critical minerals and the emerging hydrogen industry.