Australia’s miners have welcomed the unveiling of the federal government “Critical Minerals Strategy 2023-2030” which has identified that the nation’s world-leading battery and energy metals providers could increase the country’s annual GDP by $133.5 billion by 2040.
The Minerals Council of Australia’s (MCA) chief executive officer, Tania Constable, says the government’s long-awaited documents highlight the significant potential the critical minerals sector offers for the nation’s future as it plays a key role in the global push to reach net zero by 2050.
Dramatic critical minerals demand forecast
The MCA and the federal government both agree that the forecast global demand for critical raw minerals and metals is staggering.
“Based on current mine sizes, by 2035 at least 384 new mines for graphite, lithium, nickel and cobalt alone are needed to provide the processed materials required to meet demand for electric vehicles,” Ms Constable said.
“By 2027, copper demand for manufacturing electric vehicles is expected to increase by 1.7 million tonnes.”
The federal government noted that Australia is the world’s largest producer of lithium, the third largest producer of cobalt and fourth largest producer of rare earths.
It also produces significant amounts of metals such as aluminium, nickel and copper, which combined with critical minerals, are crucial for low-emissions technology such as electric vehicles, batteries, solar panels, and wind turbines.
The government says independent modelling has forecast that increasing exports of critical minerals and energy-transition minerals could create more than 115,000 new jobs and add $71.2 billion to GDP by 2040.
However, the number of jobs could increase by 262,600, and the increase in GDP strengthen to $133.5 billion by 2040 if Australia builds downstream refining and processing capability and secures a greater share of trade and investment.
Well considered approach
Ms Constable said the government’s strategy provides a high level, well considered six-point framework to guide the urgent work needed to further develop Australia’s critical minerals mining and processing industries.
The MCA also welcomed a $500 million inclusion from the Northern Australian Infrastructure Facility, in addition to the funding available from the National Reconstruction Fund and the Export Finance facility.
However, Ms Constable pointed out that the overall strategy has highlighted the significant work that needs to be undertaken.
The MCA also says that ultimately the success of the government’s strategy falls in their court, with the right regulatory policy settings needed to be put in place that encourage and support investment into Australian mining, processing and manufacturing.
“This includes stable taxation and economic policy frameworks, supported industry led fit-for-purpose ESG frameworks, workforce skills and capability development, and partnerships with Indigenous communities designed to support positive intergenerational wealth outcomes,” Ms Constable said.
Six pillars for success
The government’s new strategy highlights six focus areas:
- Targeted support for the development of strategically important projects.
- Attracting investment and building international partnerships, to optimise trade and investment settings for priority technologies.
- Engagement with First Nations people and providing benefit sharing, to strengthen engagement and partnership and to improve equity and investment opportunities for First Nations interests.
- Promoting Australia as a world leader in environmental and social governance (ESG) standard.
- Unlocking investment in enabling infrastructure and services.
- Growing a skilled workforce.
Government collaboration is critical
Federal Minister for Resources and Northern Australia, Madeleine King, said the critical minerals strategy will require a collaborative approach between with state and territory governments.
She declared that the strategy highlights the crucial role Australia can play in delivering the processed minerals the world needs for a clean energy future, building on a rich geological endowment and record as a reliable exporter of energy and resources.
“The path to net zero runs through the resources sector,” the Minister said.
“The new Critical Minerals Strategy outlines the enormous opportunity to develop the sector and new downstream industries which will support Australia’s economy and global efforts to lower emissions for decades to come,” she said.
The Minister also agreed that while the potential is great, so too are the challenges.
“The Strategy makes it clear our natural minerals endowment provides a foot in the door, but we must do more to create Australian jobs and capitalise on this unique opportunity.”
The Minerals Council agrees that the social and economic opportunity available to Australia will depend on state and federal governments successfully integrating and implementing policy and regulatory settings to remove impediments to new investment.
“Australia is well placed to be the global supplier of choice for mined and processed critical minerals. Australia’s minerals industry is a world leader and has a global reputation for ESG performance and sustainable practices,” Ms Constable said.
“Supported by the right economic policy settings and international partnerships, Australia’s rich resource endowment enables it to produce and process the full spectrum of critical minerals the world needs for electrification of our cars and transport systems, our phones and laptop computers, our health and defence systems.”
Creating an enduring framework
Minister King said the new Critical Minerals Strategy provides a vision to grow Australia’s critical minerals wealth, create Australian jobs in mining and manufacturing, strengthen global clean energy supply chains, and support the world to achieve net zero emissions.
“The strategy will be an enduring framework to guide future Government policy decisions to maximise the national benefits of Australia’s internationally significant critical minerals endowments.”
The new strategy adds to the Government’s wider suite of policies to support the sector, including finance through the Critical Minerals Facility and National Reconstruction Fund, investments in research and development, and grants to help develop early- to mid-stage critical minerals projects.
Along with the proposed $500 million of new investment into critical minerals projects, the Strategy will also establish a process to update the critical minerals list on a more regular basis.
“International competition for investment in critical minerals is already intense, with incentives announced by the United States and European Union designed to boost investment to diversify supply chains and to decarbonise their economies.”
Minister King noted that the Australian government is already working with industry and international partners to help local projects connect with emerging markets in the US, the UK, Japan, Korea, India and the European Union.
