Australia is positioning itself as a partner in efforts to secure and diversify Western supply chains for rare earths and critical minerals, as the United States works to reduce its reliance on China.
Rare earths and critical minerals are essential for defense and energy applications, and China’s control over supplies raises national security concerns for the United States. This presents an opportunity for Australia as it looks to reach a broader deal on trade and security with the Trump administration.
The tension between the U.S. and China on rare earth and critical minerals supplies raises the stakes for next week’s meeting between Australian Prime Minister Anthony Albanese and President Donald Trump. Policy experts in the mineral sector said Australia presents an offer to President Donald Trump to supply vital minerals and help reduce reliance on China.
Mining has been a significant part of Australia’s economy for decades. Australia possesses 43 of the 55 critical minerals and is one of the world’s major producers of rare earths.
Gracelin Baskaran, the director of the critical minerals security program at the Center for Strategic and International Studies, said Australia’s “combination of financial capital, physical capital, geological reserves, and human capital makes it a crucial partner and really inextricable to creating supply chains independent of China.”
Australia and China have worked closely together to process minerals, but Baskaran noted that in the last few years, Australia has shifted away from Beijing toward other Western countries.
As part of its efforts to support the potential partnership, Australia is seeking to build a $782 million stockpile of minerals, with a focus on rare earths, Reuters reported earlier this week.
Now, it could use that as a bargaining chip with Trump.
“The Australian government wanted to remain flexible and talk with the Trump administration to plug holes and see what they were most interested in before Australia finalized and rolled out this strategic reserve,” Hayley Channer, the Economic Security Director at the U.S. Studies Center, told ABC News.
Channer said the upcoming meeting between Albanese and Trump is “critical to clinch a deal,” adding the U.S. has shown interest in doing business with Australian companies and mining. Bloomberg reported this week that Australian companies like Nova Minerals Ltd. and Resolution Minerals Ltd. will brief the Australian government before the meeting.
The meeting on Monday will be Trump’s first sit-down with Albanese during a time when Australia has been hit with U.S. tariffs and as it seeks security assurance from the president.
“We need to find a way to engage the U.S. government so that they bring more investment to Australia to do downstream processing, and make sure that we share the benefits, so that there’s a national benefit, not just benefits for individual Australian companies,” she added.
China has recently imposed stricter export restrictions on rare earth elements. That represented a major escalation in trade disagreement with the U.S. is
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Sarah Venuto, executive director of The American Critical Minerals Association, told the Washington Examiner in a statement that the White House team has been “laser-focused” on advancing domestic production and processing of minerals.
“However, while U.S. policymakers are working to further trade, tax, and permitting policies that will accelerate investment in the sector and advance a growing number of mining projects here in the U.S., it is important to remember that the ramp-up to production is often lengthy, and the United States has an immediate need to secure alternative supply chains and reduce reliance on China,” she added.
Venuto said, “Exploring deals with trusted national security partners like Australia is an important strategic move by the administration to ensure that we meet national security and industry demands.”
