Rare earths tipped as first in line as others wait to see who wins in Labor’s ‘bold’ critical minerals reserve

Rare earth players are in pole position to reap the benefits of the Federal Government’s $1.2 billion cash splash, while battered lithium and nickel miners and refiners wait to see if they will get a look-in. Miners were broadly supportive of the Albanese Government’s proposal to buy their wares under a new national offtake agreement policy designed to shore up Australia’s ample reserves of critical minerals. The final cohort of the chosen priority minerals will be whittled down from Australia’s existing list of 31 critical minerals, which includes lithium, cobalt, nickel and vanadium among others. The West Australian understands germanium, used in semiconductors, and tungsten, a dense metal used for alloying, are also likely contenders. But it remains to be seen whether the likes of lithium and nickel, which are already queued up for a production tax credit benefit perk should Labor win the Federal election next month, will get more relief from dire global prices. Dale Henderson, chief executive of WA lithium miner PLS, nonetheless lauded the policy as a “bold move” and said he looked forward to working with the government to help shape the initiative. “We commend the Government’s pursuit of long-term offtake agreements to support price stability, investment confidence, and Australia’s position as a preferred partner for sustainable lithium supply,” Mr Henderson said. Aaron Hood, boss of Wesfarmers’ chemicals division WesCEF, called it an “innovative approach to support the industry”. Unveiling the Critical Minerals Strategic Reserve policy in Perth on Thursday, Prime Minister Anthony Albanese gave a strong indication that rare earths will be a top priority. Analysts at Citi put the bets on Iluka Resources, which is building a $1.2 billion rare earths refinery at Eneabba in WA’s Mid West, as a likely beneficiary of the plan. “It is reported that a task force will be created to consult and finalise the scope and design of the strategic reserve, which is expected to be operational in the second half of 2026,” Citi said in a note. “This sounds like a reference to Iluka’s rare earth’s refinery where the Government has provided a $1.65b loan.” The refinery is set to be fully commissioned in the latter half of 2026. Perth-based Lynas Rare Earths is the other major player trying to establish a rare earths industry in Australia, and has spent more than $800 million building out its processing capabilities near its Mt Weld mine in Kalgoorlie. The miner also has refining operations in Malaysia. In a not so subtle swipe at rival operator Lynas, Iluka chief executive Tom O’Leary urged the Government to ensure the policy focused on cultivating an Australian rare earths refining industry, “as distinct from promoting the export of concentrates and other unrefined intermediates, with the refining being done overseas.” “This just further empowers the existing monopoly producer,” he said. “We’re an established minerals processor that will be mining, processing and refining rare earth oxides in Australia. This is the security of supply of refined products that will be the foundation of an independent Western supply chain that is clearly required.” Wyloo Metals and Hastings Technology Metals are in the earlier stages of constructing a rare earths mine and refinery at the Yangibana project in WA’s Gascoyne region. Prefacing that details of the proposal were yet to be confirmed, Wyloo chief executive Luca Giacovazzi said initiatives that strengthened local supplies would give industry more confidence to plan and invest. Darryl Cuzzubbo, who runs Gina Rinehart-backed junior Arafura Rare Earths, said the policies would help grow the Australian industry at a time when global trade rules were being “rapidly rewritten”. “It is now abundantly clear that China’s control of nearly 90 per cent of the world’s NdPr rare earth supply provides an outsized level of influence in defence, electronics, EVs, wind turbines, robotics and other consequential sectors,” he said. Northern Minerals chief Shane Hartwig advocated that Australia had a unique opportunity to build reserves of the less commonly found heavy rare earths subsets of dysprosium and terbium. “We will await the outcome of next week’s Federal election to see if the Critical Minerals Strategic Reserve will be implemented, and if so how it will impact our world-scale Browns Range Heavy Rare Earths Project.” China is the dominant supplier of rare earths, which help make magnets used in the manufacture of a range of appliances such as phones, MRI machines, missiles and wind turbine motors. Ensuring Australia has its own supply of rare earths has become even more crucial after China halted exports in response to US President Donald Trump’s global tariffs. Association of Mining and Exploration Companies chief Warren Pearce said the policy was a positive step forward, and would help with the upfront costs of new projects. “This policy setting will help Australia leverage our position as a major critical minerals player in the global market,” he said. AMEC also noted that miners would need to be consulted on how the reserve will actually work as well as how and when it would be implemented. Chamber of Minerals and Energy WA chief Rebecca Tomkinson said recent trade disruptions created a “golden opportunity” for Australia to step in. “The market for rare earths is thin, opaque and subject to unpredictable price swings, which has acted as a major barrier to getting projects off the ground.” She said that Australia’s high environmental, social and governance standards should be baked into prices the government paid for any minerals.

Rare earths tipped as first in line as others wait to see who wins in Labor’s ‘bold’ critical minerals reserve

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