Australia announced funding to boost output of critical minerals, aiming to diversify supply for its allies.

Prime Minister Scott Morrison unveiled the funding for a slew of projects in Western Australia on Wednesday and said the state would become a powerhouse for Australia’s allies.

Recent events have underlined that Australia faces its most difficult and dangerous security environment that we have seen in 80 years. The events unfolding in Europe are a reminder of the close relationship between energy security, economic security and national security, he told reporters.

A meeting of the Quad group leaders of Australia, United States, Japan and India agreed in Washington in September to improve supply chain security for rare earths.

China currently dominates around 70 to 80 percent of global critical minerals production and continues to consolidate its hold over these supply chains. This initiative is designed to address that dominance, said Angus Taylor, minister for industry, energy and emissions reduction.

Diplomatic relations between Australia and China are strained, with Canberra describing trade sanctions imposed on Australian agriculture and coal by Beijing in response to political grievances as “economic coercion”.


The Project's Scope

Critical minerals are used in smartphones, computers, rechargeable batteries and electric cars as well as defence and space technology.

Projects to be funded include the second rare earth separation plant to be built outside China, a battery material refinery and a vanadium processing plant. Funding will also be provided to commercialise government research and bring new companies to market.