Treasurer Jim Chalmers will brief Australia’s allies and trading partners on these new details in Washington DC this week. This follows Resources Minister Madeleine King’s engagement at G7+ meetings in Toronto late last year.
Australia’s abundant supply of critical minerals will be essential for global supply chains and for strengthening economic partnerships with other nations, and that is what the Treasurer’s visit to the United States is working towards.
The first minerals to be the focus of the Strategic Reserve will be antimony, gallium and rare earth elements, which are crucial for clean-energy and high-technology manufacturing as well as advanced military equipment.
The Reserve will operate by securing rights to minerals produced in Australia and on-selling those rights to meet demand, giving an added boost to Australia’s critical minerals sector and strengthening reliable supply chains for our trading partners.
Rare earths are used to make high-performance permanent magnets, essential inputs to a range of technologies from fighter jets to MRI machines.
Antimony is used in household and commercial batteries, night vision equipment and high-performance flame-retardant materials.
Gallium is a key ingredient for advanced semiconductors used in radar systems and telecommunications.
The Reserve includes $1 billion for transactions to be drawn from the expanded $5 billion Critical Minerals Facility, which provides government-backed loans and equity support for projects. A further $185 million has been allocated for selective stockpiling of minerals, where required, and other implementation costs.
The Reserve will support Australia’s collaboration with international partners to diversify critical minerals supply chains, including the United States, Japan, Republic of Korea, Europe, Canada and the UK. The Government will advance consultation with international partners on developing collaborative efforts to maximise the impact of the CMSR on global supply chains.
The government will bring forward enabling legislation this year to provide Export Finance Australia with additional powers to effectively support the Reserve.
Future transactions under the Reserve will be led out of the Department of Industry, Science and Resources, in close partnership with Export Finance Australia.
The Critical Minerals Strategic Reserve supports Australia’s updated Critical Minerals Strategy and follows the landmark agreement signed with the United States last October which will support a pipeline of projects across critical minerals and rare earths valued at around $13 billion.
It also supports Australia’s collaboration with allies to diversify critical minerals supply chains, including Canada, Japan, Europe and the UK.
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