Updating Australia’s Critical Minerals List: issues paper

Attachment 1 – Submission to updating Australia’s critical minerals list

The Department of Resources supports the Australian Government in reviewing the purpose, criteria and minerals listed on Australia’s critical minerals list, to clearly signal its policy priorities for the sector and provide clarity to the community, industry and investors.

The Department of Resources acknowledges the importance of ensuring stable and secure global supply and access of key minerals necessary for modern technologies to maintain and increase current standards of living. Minerals are also required to transition the global economy and energy systems to net zero carbon emissions. The pace of change required for the energy transition and the looming mismatch between planned supply and anticipated demand of minerals presents an important opportunity for Australia as a world-leading minerals supplier.

‘Critical minerals’ as a term helps frame this context and is already part of the public discourse and used by many international governments. For Queensland, ‘critical minerals’ is associated with the next chapter for its resources industry, as global factors drive (market and government) interest and investment into new opportunities beyond traditional carbon-based energy commodities. The term is therefore an important communicative tool to build common understanding of high-order societal objectives and social licence in communities.

The Department of Resources encourages the Australian Government to continue engaging states and territories to identify Australia’s critical minerals with a strategic advantage for economic growth and building value chains onshore to assist in focussing governmental and market efforts. A coordinated, targeted approach will improve investment outcomes and reduce inefficiencies that may lead to duplicative or unnecessary infrastructure and market pathways.

Clarity and consistency

In updating the list, the Department of Resources considers it important to acknowledge the key use and drivers for each mineral deemed ‘critical’ – e.g. critical for defence manufacturing, advanced technologies to support current modern living standards, food security, and/or the global economic and energy transition/decarbonisation. Acknowledging these demand drivers will provide clarity and mitigate issues with a generic understanding of critical minerals for stakeholders and assist policy development in relevant industry sectors.

The Australian Critical Minerals Strategy 2023-2030 defines critical minerals as ‘metallic or non-metallic materials that are essential to our modern technologies, economies and national security, and whose supply chains are vulnerable to disruption’, which mirrors the current list criteria. The Department of Resources suggests it would be beneficial to:
• clarify the reference to ‘minerals’ and ‘materials’ to mitigate questions about non-
targeted raw materials and assist in listing items in a consistent format. For example,
by the element, ore or processed product (e.g. aluminium, bauxite, or high purity
alumina).
• clarify the reference to ‘modern technologies’ to explicitly reference the global energy
and economic transition to net zero emissions and the looming mismatch between
planned supply and demand as a key driver or criteria.
• consider weighting the critical mineral criteria, including, for example, allowing minerals
to satisfy several but not all criteria.

It will also be beneficial for the Australian Government to be clear on how the list is intended be utilised in government policy and programs.
Recognising Australia’s strengths

The critical minerals list as a tool intended to guide government policy and investment priorities should recognise Australia’s strategic strengths and position in the critical minerals value chain. Australia is a country that is:

• rich in resources, therefore seeking investment (not exclusively) in extraction;
• generally underpinned by exporting the mineral (at some early stage of refinement)
and importing technological products; and
• aspiring to capture more of the value chain onshore.

The critical minerals list should therefore reflect the critical mineral demands of global customers to attract investment in the supply of minerals (extraction, refinement and further downstream processing) in Australia.

Review process

The Department of Resources supports the Australian Government establishing a process to update the critical minerals list to ensure that it can respond to global strategic, technological, economic and policy changes. However, this flexibility must be balanced with the certainty required to build Australia’s critical minerals value chain. For example, a decision to remove a critical mineral from the list should consider the potential impacts on investment decisions from previously committed government support.