Australia Invests $22 Million in 3 Rare Earth Projects to Counter Beijing’s Export Ban

‘Having an over-reliance on one supplier of any one good or technology puts you in a vulnerable position, and that’s what we want to change,’ said minister.

Jars containing rare earth minerals produced by Australia's Lynas Corp from its Mount Weld operations northeast of Perth, Australia, Aug. 23, 2019. Melanie Burton/Reuters/File

The Australian government will invest nearly $22 million (US$14.8 million) in three rare earth projects led by well-known research institutes.

This comes following Beijing’s trade restrictions in late December 2023 that prohibited the export of technology to make rare earth magnets as well as the communist regime’s efforts to curb the shipment of gallium and germanium in October.

Rare earth minerals are a group of 17 elements that are vital in the manufacture of a wide range of products, from electric cars, batteries and renewable energy infrastructures, to military equipment.

On Jan. 8, federal Resources Minister Madeleine King revealed that the Labor government would provide funding to three projects to develop the technology required for producing a number of rare earth elements.

Specifically, the government will award the Australian Nuclear Science and Technology Organisation (ANTSO) $13.9 million to research how to discover, extract, and process rare earth minerals from lower-grade deposits.

Another $5.2 million will be set aside for a project by the Commonwealth Scientific and Industrial Research Organisation to expand the value chains of lithium and other rare earth minerals as well as increase the value of tungsten ores and refractory metals.

The remaining $2.7 million will go to Geosciences’ research effort to help local resource companies produce gallium, germanium, and indium as by-products from bauxite and zinc mining.

Australia’s Effort to Counter Beijing’s Attempt to Weaken the West

In an interview with the Australian Financial Review, Ms. King said the move was aimed at protecting the country' interest in the face of the Chinese communist regime’s rare earth export ban.

“We should have done this a long time ago, but we didn’t,” she said.

“The West outsourced a lot of this work to China, so good on them, they invested in the technology, refiners, and processing, and made themselves indispensable for the future of green technologies.”

The minister also elaborated on how depending too much on China for critical minerals has put the West in a vulnerable position.

“We know you can get these minerals, but we just didn’t do it ourselves because we hadn’t needed to because we got them from somewhere else,” she said.

“Now that has changed because China has banned their export. So, we do have to look at how we extract them from bauxite in an economic fashion.

“Having an over-reliance on one supplier of any one good or technology puts you in a vulnerable position, and that’s what we want to change.”

According to data from the United States Geological Survey, China accounted for 70 percent of global rare earth production in 2022, up from 59 percent in the previous year.

A 2019 research by the consultancy firm Adamas Intelligence also indicated that China accounted for 85 percent of the global capability to transform the mined minerals into usable materials for manufacturers.

A man driving a front loader shifts soil containing rare earth minerals to be loaded at a port in Lianyungang, China, on Sept. 5, 2010. STR/AFP via Getty Images

Beijing Tightens Grip on Rare Earth Minerals

In July 2023, Beijing’s commerce ministry announced a plan to curb exports of gallium and germanium, two rare metals used for manufacturing semiconductors, in apparent retaliation against the United States and other Western countries over their efforts to limit China’s access to advanced chips.

The move caused the prices of gallium metal to soar as China accounted for 80 percent of the gallium production in the world, and 60 percent of germanium.

In August, the Chinese Communist Party (CCP) introduced new restrictions requiring traders to report real-time export information on rare earths.

Under the new rules, exporters had to disclose details such as the destination, quantity, shipping particulars, and other transaction information to the Chinese Ministry of Commerce, allowing Beijing to have a firmer grip on the outflow of critical minerals.

While some experts believed Beijing’s tightening control was a wake-up call for the West amid growing tension between the two sides, others did not think the communist regime would be successful with its strategy.

In an opinion piece for The Epoch Times, Milton Ezrati, an expert from The National Interest, said Beijing’s tactic might pay short-term dividends but would fail in the long term.

He pointed out that despite the word “rare” in the name, rare earth elements were much more abundant than both silver and gold.

Nevertheless, the mining and refinement of these metals are environmentally problematic, resulting in China gaining the upper hand in the international value chain due to disregard for the environmental impact of rare earth refining operations.

“China’s current dominance cuts two ways. As long as China keeps sales unimpeded, the world will remain willing to let matters stand as they are,” Mr. Ezrati said.

“But if Beijing too frequently, actively, and severely denies users these vital materials, China will lose that position of dominance, for it’s a good bet that the developed West and Japan would, in such cases, cultivate other sources and develop refining techniques acceptable to their more environmentally sensitive dispositions.”

Dorothy Li contributed to this article.