Australia to consider using critical minerals as leverage in Trump-led US tariff dispute

The Australian government has identified the nation’s critical minerals riches as a potential weapon in the tariff war now being waged by US President Donald Trump.
Australia has been hit with a 10% tariff as part of President Trump’s sweeping “Liberation Day” reciprocal tariffs for countries around the world, which have created havoc in financial markets.
The tariffs have become a major political issue in the lead-up to Australia’s federal election, with the government and opposition rushing to come up with answers.
Negotiating tool
Prime Minister Anthony Albanese has confirmed that Australia is considering using its position as one of the world’s leading critical mineral resource owners as a potential negotiating tool.
It is no secret that the US is desperate to secure supplies of critical minerals and rare earths to protect itself against China’s global dominance in that area.
Australia is now planning to establish a critical minerals strategic reserve in the coming weeks that would stockpile resources and hold them back from export.
MCA hits out at move
The Minerals Council of Australia (MCA) believes the critical minerals strategic reserve proposal presents significant risk for investors and miners alike.
At the same time, the MCA is hoping certain minerals will be made exempt from the imposition of tariffs on Australian exports to the US, with further clarification needed from the Trump administration.
“The tariff edict states that copper, pharmaceuticals, semiconductors, bullion and lumber articles will be exempt, as well as ‘energy and other certain minerals not available in the United States,’ which is likely to include a range of critical minerals and uranium,” MCA chief executive officer Tania Constable said.
Gold exemption
“This is particularly important for Australian gold, with exports to the US hitting $4.6 billion in January 2025, over 85 per cent of total gold exports,” Ms Constable added.
“Australia has long been a reliable and trusted global supplier of minerals and critical materials, with our enduring trade and defence partnership with the United States forming the backbone of decades of economic and strategic collaboration.”
“These trade tariffs undermine this crucial alliance, destabilising supply chains and increasing costs to consumers.”
“It is a race to the bottom.”