"We hope to see manufacturing of missiles commenced in Australia in two years' time," Australian Defence Minister Richard Marles told reporters, hailing the project as a boost for his country's defence and industrial base.

"We are really pleased with the steps that we are taking in respect of establishing a guided weapons and explosive ordnance enterprise in this country," Marles said.

The project will see Australia develop guided multiple launch rocket systems -- or so-called GMLRS.

US Secretary of State Antony Blinken and Pentagon Chief Lloyd Austin travelled to Brisbane for the announcement, which followed discussions with Marles and Australian Foreign Minister Penny Wong.

Washington will now work with Australia to develop its fledgling domestic missile industry, with an eye to securing a reliable pipeline for its own armed forces down the track.

The war in Ukraine has put a heavy strain on military supply chains in the United States, steadily depleting stocks of missiles and other munitions.

Australia is currently embarking on its own armed forces overhaul, pivoting towards long-range strike capabilities in an effort to keep would-be foes such as China at arm's length.

Canberra has also agreed to refurbish military bases in the strategically-important north of the country, allowing them to host training exercises and ramped-up rotations of US troops.

"We've made important steps forward in respect of American force posture initiatives," said Marles.