Updating Australia’s Critical Minerals List: issues paper

PHOSPHATE
Critical Mineral Submission

Verdant Minerals
Contents

1. Is the current set of criteria still fit for purpose? .............................................................................. 2

2. Phosphate ....................................................................................................................................... 3

a) Which technologies does the mineral feed? ............................................................................... 3

b) What evidence is there of supply chain disruption relating to those minerals? ........................... 3

c) What market, financing, technical or other barriers affect these supply chains? ........................ 4

d) Are the barriers or supply chain disruption risks more acute in certain applications or levels of
mineral grade or purity than others? .................................................................................................... 4

3) Should Australia differentiate between criticality or importance of minerals, and the capability to process them, through categories within the list or a separate category that sits alongside the list? ...... 5

4) What lessons could be learned from other countries’ approaches or the ways in which they consider their criteria for listing critical minerals?.................................................................................................. 7

5) What should trigger an update to the list? ........................................................................................... 8

References .............................................................................................................................................. 9

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1. Is the current set of criteria still fit for purpose?

Current Criteria

Minerals that are…

• Essential to modern technologies, economies, and national security , whose supply chains are
vulnerable to disruption
• That our strategic partners need; and
• For which Australia has potential economic geological resources.

Proposed Update

Minerals that are…

• Essential to modern technologies, economies, societies, and national security
• whose supply chains are vulnerable to disruption
• That our strategic partners need; and
• For which Australia has potential economic geological resources.

Australia’s current criteria for a critical mineral is missing a key term, essential to society, and is therefore not fit for purpose. Supporting societal growth is the fundamental reason why mineral extraction occurs, whether that be for infrastructure or food security [1]. By omitting essential to society in its definition of a critical mineral, Australia risks missing on opportunities to protect vital mineral supply chains that, amongst other areas, underpin food security. Making sure plant-nourishing minerals are included is essential to building a sustainable supply chain, allowing Australia to feed itself and the world.

While it can be argued that ‘essential to technologies, economies, and national security’ all point towards and fall under the umbrella of ‘society’, explicitly including the term can only bring benefit as it emphasises why the list was originally created and ensures a more complete definition. Through bringing more clarity to the criteria, disagreements on what constitutes a critical mineral can be reduced thereby increasing the speed at which minerals are added, making the list more dynamic and a better reflection of the current global situation.

In addition to this, including the term ‘society´ allows for greater flexibility in the future when adding or removing minerals from the list. There are many cases of minerals that have become vital through time as society develops, such as bitumen for roads or potash for food security [2], and while these minerals are important for the economy, they are more quickly understandable as essential to society.

Ultimately, Australia’s Critical Mineral List was created to better support and protect society, so including essential to society in the criteria allows for the list to achieve its purpose in a more successful, effective, and complete manner.

The remaining criteria, namely vulnerable supply chains, needed by strategic partners, and for which
Australia has potential economic geological resources, all are still fit for purpose when defining what constitutes a critical mineral.

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2. Phosphate

a) Which technologies does the mineral feed?

While phosphate certainly contributes towards technical advancements through its usage in new LFP batteries (Lithium Iron Phosphate) [3], its significance extends far beyond that through its role feeding societies. Phosphate, commonly referred to as phosphorous, is a vital nutrient in agriculture, enabling domestic and international food security. Stable and secure supply-chains of the nutrient are critical for plant and crop production as the mineral cannot be substituted.

Its importance for food security cannot be overstated, as it is one of the three essential macronutrients, alongside nitrogen and potassium, necessary for plant development [4]. Through helping with root development, flower and fruit formation, and overall plant health, phosphate levels in agricultural soils are crucial to ensure stable and abundant food production, with high-demanding crops like grains, legumes, and oilseeds being particularly dependent [5]. Without proper phosphate supplementation, soil depletion can lead to reduced crop yields, lower food quality, and increased vulnerability to food shortages, making phosphate an indispensable component of modern agricultural practices.

b) What evidence is there of supply chain disruption relating to those minerals?

Being such a critical mineral for the global agricultural industry, any disruption to the phosphate supply chain causes widely experienced problems. With 85% of the world’s remaining high-grade phosphate rock being concentrated in just five countries (Morocco, China, Egypt, Algeria, and South Africa), recent supply chain problems come as no surprise [6].

2022 saw the most recent global phosphate disruption. China, the world’s biggest exporter of the mineral imposed tariffs from COVID-19, and Russia, one of the top five producers, has faced sanctions from Western powers after its invasion of Ukraine [6]. With phosphate being sourced from only a handful of countries, risk of supply chain disruption is high.

Looking to the future, researchers expect that phosphate supply will fall below global requirements in
2040, indicating that further supply chain disruption is to come. Simulation results show that by 2050 phosphate rock production needs to double by 2050 compared to levels in 2020, as regions that are expected to experience the highest population growth are also those most dependent on phosphate imports. [7].

It is worth nothing that Australia currently only has one manufacturer of ammonium phosphate fertilisers
(Incitec Pivot) and is therefore heavily reliant on imports [8]. Building multiple sources of domestic production of phosphate rock can lessen the risks associated with this reliance, reducing the chances of domestic supply chain disruptions.

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c) What market, financing, technical or other barriers affect these supply
chains?

Being a non-renewable natural resource, the main barrier that affects the phosphate supply chain are supply constraints. The global distribution of high-quality phosphate rock resources in unusually unequal, with five countries (Morocco, China, Egypt, Algeria, and South Africa) hosting 85% of the world’s high-quality phosphate rock [6]. As it is impossible to change that, focusing on developing phosphate rock resources in countries outside of that is globally significant and beneficial as it de-risks a commodity that directly influences food security. As seen when Russian exports were shunned, having a few counties in control of a mineral so critical poses significant barriers to the supply chain.

With global population forecast to be 9.7 billion by 2050, the global agricultural industry will see an all- time high for demand [9]. To support this demand, the phosphate industry will need to double the 2020 level of production by 2050 [7]. As the commodity cannot be synthesised, further pressure will be put on the supply chain, as all the minerals must be sources from the Earth [6].

d) Are the barriers or supply chain disruption risks more acute in certain
applications or levels of mineral grade or purity than others?

Phosphate fertilizer grades vary based on their phosphorus content, presented as P2O5 (phosphorus pentoxide), which is a standard measure. There are three primary phosphate grades:

➢ Diammonium Phosphate (DAP): DAP is a high-phosphorus fertilizer containing around 46%
P2O5. It is a popular choice for crops requiring an immediate supply of phosphorus, as it also
provides nitrogen. DAP is highly water-soluble and suitable for a wide range of soil types and
crops.

➢ Monammonium Phosphate (MAP): MAP contains a slightly lower phosphorus content,
typically about 52% P2O5, compared to DAP. It also provides nitrogen and is known for its
versatility in various soil conditions. MAP is often preferred when phosphorus requirements are
not as high as those of DAP.

➢ Triple Superphosphate (TSP): TSP has a phosphorus content around 46% P2O5. Unlike DAP
and MAP, it doesn't contain nitrogen. TSP is a less concentrated phosphorus source but offers
the advantage of slow-release, making it suitable for long-term soil enrichment and for crops
with low to moderate phosphorus needs.

Although DAP and MAP have stronger demand than TSP due to their suitability for a wide range of crops and soil types, all three fertilizer grades are affected by phosphate rock supply disruption.

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3) Should Australia differentiate between criticality or importance of minerals, and the capability to process them, through categories within the list or a separate category that sits alongside the list?

Australia's Register of Critical Minerals encompasses minerals of great significance to contemporary technologies, economic resilience, and national security, each possessing supply chains susceptible to potential disruptions. The compilation of Australia’s register is underpinned by an analysis of global technological prerequisites, with particular emphasis on emissions reduction, advanced manufacturing, and defence applications.

The Australian Government is presently engaged in the establishment of a structured process for the periodic revision and refinement of this register. This initiative is designed to ensure its continued relevance and adaptability in the face of evolving global strategic imperatives, technological advancements, economic dynamics, and policy shifts [10].

Distinguishing minerals based on their criticality is essential to prioritize resources and efforts. This can help focus research, investment, and policy initiatives on ensuring a stable supply of these minerals.
While criticality is a crucial factor, the capacity for processing minerals within the country should not be overlooked. It's not enough to have access to these minerals; the ability to process them into value- added products is equally important. Developing domestic processing capacity can enhance economic benefits, reduce reliance on external sources, and create jobs.

Recognizing phosphate as a critical mineral can spur research and development in the mining and processing of phosphate resources. This innovation can lead to more efficient and environmentally friendly extraction and processing technologies, positioning Australia as a leader in the global phosphate market.

The global demand for fertilizers, including phosphate-based ones, is steadily increasing due to the growing world population and the need to enhance agricultural productivity. Historically, Australia has imported a significant portion of its phosphate requirements. Classifying phosphate as a critical mineral can incentivize the development of domestic phosphate resources, reducing reliance on imports and enhancing the nation's self-sufficiency in this critical agricultural input.

Phosphate-based fertilizers can improve nutrient use efficiency in crops, reducing the environmental impact associated with excessive fertilizer use. Australia can promote sustainable phosphate mining and processing practices to align with its environmental goals. Disruptions in global phosphate supply chains can have severe consequences for agriculture and food production. By classifying phosphate as a critical mineral, Australia can prioritize strategies to secure its supply, reducing vulnerability to international market fluctuations.

Phosphate should be considered a critical mineral due to its criticality and importance to multiple industries, particularly agriculture. Prioritizing phosphate can support the country's agricultural sector, bolster its economic growth, reduce import dependence, promote environmental sustainability, enhance national security, and drive innovation. Therefore, classifying phosphate as a critical mineral aligns with Australia's long-term economic, environmental, and strategic interests.

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Furthermore, Australian phosphates demand has an additional dimension of criticality in that they are clean of deliterious elements in other rock phosphates, such as those from Morocco and Belarus containing elevated amounts of cadmium and uranium.

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4) What lessons could be learned from other countries’ approaches or the ways in which they consider their criteria for listing critical minerals?

• Importance of Diversification - Relying heavily on a single supplier or global market can lead
to vulnerabilities (Prioritizing domestic or diversified sources of phosphate can ensure a stable
supply)
• Economic Significance - Phosphate as a critical mineral would create major contributions to
the national economy and job creation.
• Supply Chain Resilience - Implementing strategies to minimize disruptions, especially during
times of geopolitical tension is essential for a critical mineral. Minimizing disruption to
phosphate production will increase food security.
• Environmental Sustainability - Stringent environmental regulations and practices for mining
and processing critical minerals. Australia can adopt environmentally sustainable approaches
when considering phosphate as a critical mineral, ensuring that its extraction and processing
are done responsibly.
• Strategic Considerations - National security and strategic importance are often factors in
listing critical minerals. Phosphate is highly relevant for Australia’s agriculture and food security.
• Collaboration and Partnership - Learning from international collaborations can be valuable.
Australia can explore partnerships with other phosphate-producing countries to share best
practices, technology, and expertise in phosphate mining and processing.
• Research and Innovation - Investing in research and innovation would develop more efficient
and environmentally friendly phosphate extraction and processing technologies. Australia can
prioritize R&D efforts in this area to enhance its competitiveness.
• Stakeholder Engagement - Engaging with stakeholders, including industry, environmental
groups, and local communities, is important. Australia can learn how other countries involve
stakeholders in decision-making processes related to critical minerals.
• Regular Review and Updates - Periodic reviews of their lists of critical minerals to account for
changing market dynamics and technological advancements. Australia can adopt a flexible
approach, regularly reassessing whether phosphate or any other critical mineral should remain
on the list based on evolving criteria.
• Transparency and Data Collection - Reporting on critical minerals is essential. Australia can
establish clear data collection mechanisms to monitor phosphate production, consumption,
and trade to make informed decisions.

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5) What should trigger an update to the list?

To fulfil its purpose, Australia’s Critical Minerals List should be dynamic and should not be updated based on a timeframe or policy changes but rather be updated when new information is made available.
This information may come through consulting with industry, public opinion, or new research, but it is of great importance that it is acted on as quickly as possible, as doing so means that mineral can receive the maximum benefit from legislation, and thus so too can Australia’s population.

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References

[1] S. A. Hajkowicz, S. Heyenga and K. Moffat, “The relationship between mining and socio-economic well being in
Australia’s regions,” Resources Policy, pp. Volume 36, Issue1, Pages 30-38, 2011.

[2] R. A. Rawashdeh, “World peak potash: An analytical study,” Resouce Policy, December 2020.

[3] S. Abuelsamid, “Lithium Iron Phosphate Set To Be The Next Big Thing In EV Batteries,” 16 August 2023. [Online].
Available: https://www.forbes.com/sites/samabuelsamid/2023/08/16/lithium-iron-phosphate-set-to-be-the-
next-big-thing-in-ev-batteries/. [Accessed 11 September 2023].

[4] D. Sinha and P. K. Tandon, “An Overview of Nitrogen, Phosphorus and Potassium: Key Players of Nutrition
Process in Plants,” in Sustainable Solutions for Elemental Deficiency and Excess in Crop Plants, SpringerLink,
2020, pp. 85-117.

[5] PotashDevelopementAssociation, “Potash and Sulphur for Grain Legumes,” December 2020. [Online].
Available: https://www.pda.org.uk/pda_leaflets/18-potash-and-sulphur-for-grain-legumes/phosphate-for-
legumes/. [Accessed 4 October 2023].

[6] J. Martin-Ortega, B. Jacobs and D. Cordell, “Phosphorus supply is increasingly disrupted – we are sleepwalking
into a global food crisis,” 16 December 2022. [Online]. Available: https://theconversation.com/phosphorus-
supply-is-increasingly-disrupted-we-are-sleepwalking-into-a-global-food-crisis-196538. [Accessed 4 October
2023].

[7] C. Nedelciu, K. Ragnarsdottir, P. Schlyter and I. Stjernquist, “Global phosphorus supply chain dynamics:
Assessing regional impact to 2050,” Global Food Security, September 2020.

[8] Incitec Pivot Limited, “About Incitec Pivot Limited,” 2023. [Online]. Available:
https://www.incitecpivot.com.au/about-us/about-incitec-pivot-limited/company-profile. [Accessed 12 October
2023].

[9] United Nations, “Population,” 2023. [Online]. Available: https://www.un.org/en/global-issues/population.
[Accessed 4 October 2023].

[10] Australian Gov. - Department of Industry, Science and Resources, “Australia’s Critical Minerals List,” 20 June
2023. [Online]. Available: https://www.industry.gov.au/publications/australias-critical-minerals-
list#:~:text=Table%201%3A%20Australia%E2%80%99s%20Critical%20Minerals%20List%20%20,%20%20Y
es%20%2022%20more%20rows%20.

[11] Australian Gov. - Department of Industry, Science and Resources , “Critical Minerals Strategy 2023–2030,” 7 July
2023. [Online]. Available: https://www.industry.gov.au/publications/critical-minerals-strategy-2023-2030.

[12] PotashDevelopmentAssociation, “Functions of Potash,” December 2021. [Online]. Available:
https://www.pda.org.uk/pda_leaflets/13-oilseed-rape-and-potash/functions-of-potash/. [Accessed 4
September 2023].

[13] PotashDevelopmentAssociation, “What are the effects of potash deficiency?,” 2013. [Online]. Available:
https://www.pda.org.uk/what-are-the-effects-of-potash-deficiency/. [Accessed 4 October 2023].

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