US President Donald Trump signed a deal this week with Prime Minister Anthony Albanese giving the United States access to Australia's vast reserves of rare earths and critical minerals essential for everything from solar panels to precision missiles.
And the head of Australian rare earths miner Arafura Resources said developing projects outside of China could only be a good thing.
"China has basically controlled the rare earths market by controlling the price," Arafura boss Darryl Cuzzubbo told AFP.
"The problem right now is China is showing that they'll use their 90 percent control of rare earths production as a geopolitical tool."
China controls some of the world's largest reserves of rare earth elements and wields enormous influence as almost the sole country able to refine the metals on an industrial scale.
Manufacturing nations such as the United States, Germany and South Korea have long been on the hunt for partners less likely to use rare earths as a bargaining chip.
The US-Australia deal paves the way for alternative supply chains outside of China, Cuzzubbo said.
"And that then gives investors confidence that these like-minded countries will do something to change China's control."
In essence, the United States has agreed to help finance a batch of rare earths projects in Australia -- gaining preferential access to the minerals they unearth in return.
Australia is very good at digging up its critical minerals, but like most other mining nations has struggled to process them onshore.
More than 90 percent of Australia's lithium is shipped each year to the hulking refineries of China.
Arafura Resources owns one of the first projects to receive financing under the US-Australia deal, and is aiming to swiftly scale up its own refining capacity.
Another Australian company, Lynas Resources, already has a US$258 million contract to build a rare earths refinery in Texas.
"There's going to be a dance going on with China until there is this diversified supply chain," said Cuzzubbo.
"And China is going to milk it for whatever they can, because they know in three to five years' time, they're starting to lose the control."
Analysts consider it unlikely that Australia will ever produce refined rare earths on China's scale.
But it could loosen the country's stranglehold if it could build up to even a small fraction of its processing capacity.
"Australia is the United States' most important partner in countering China's dominance in rare earths," the Centre for Strategic and International Studies said this week.
EU, China to hold 'urgent' talks on rare earth curbs
Strasbourg, France (AFP) Oct 21, 2025 -
EU and Chinese officials have agreed to meet in Brussels for "urgent" talks on China's export controls on rare earths, EU trade chief Maros Sefcovic said after speaking to his Chinese counterpart Tuesday.
The world's leading producer of the minerals used to make magnets crucial to the auto, electronics and defence industries, China this month announced new controls on the export of rare-earth technologies.
"I appreciate today's constructive discussion during which we agreed to intensify contacts at all levels," Sefcovic said after a video call with China's Wang Wentao that lasted nearly two hours.
"I invited the Chinese authorities to come to Brussels in the coming days to find urgent solutions. Minister Wang Wentao has accepted this invitation," Sefcovic told reporters in the European Parliament in Strasbourg, France.
The European Union says the Chinese restrictions have forced some of the bloc's companies to halt production and inflicted economic harm.
Sefcovic has called the export controls "unjustified and harmful".
Brussels has been coordinating with G7 partners on a response to China's curbs but Sefcovic said the EU had "no interest in escalation".
"However this situation cast a shadow over our relationship. Therefore, a prompt resolution is essential," Sefcovic said.
Related Links
Space Technology News - Applications and Research
| Subscribe Free To Our Daily Newsletters |
| Subscribe Free To Our Daily Newsletters |
