CANBERRA, March 25 (Reuters) – Australia will “no doubt” have an element of a floor price in its strategic reserve for critical minerals, Resources Minister Madeleine King said on Wednesday, as the resources rich nation looks to cement its role as a key supplier to its allies.
“We are developing a strategic reserve. And that will no doubt have an element of a floor price as well,” King told delegates at the Minerals Week summit in Canberra, adding the government would consult the industry to get the right price.
“It is about a different pricing mechanism to reflect the cost of producing these materials.”
Australia plans to be the leading supplier of critical minerals like rare earths, which are key to industries from automotive to defence, partly by developing a strategic reserve with funding of A$1.2 billion ($793 million).
It is expected to be up and running by the second half of 2026, underscoring the country’s ambitions to become a key player in global mineral markets.
Australia is also supporting investments through entities such as the export finance agency, to the tune of an additional A$4 billion and the Northern Australia Infrastructure Fund (NAIF) to crowd in private investment.
To build Australia’s role as a trusted supplier of critical minerals as global supply chains are rebuilt, Australia must be prepared to financially back such projects beyond the short term, King said.
“They are long term investments … I do think we will need to keep doing this for some time,” King said.
China produces and refines more than 80% of critical minerals needed by industry and its restrictions on some exports last year roiled the automotive and defence industries, fuelling a drive to diversify global supply.
(Reporting by Melanie Burton; Editing by Chris Reese and Stephen Coates)
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