The numbers behind Australia’s critical minerals drive

James Thornhill
08:00am May 28 2024

Lithium ore falls from a chute onto a stockpile at a facility in Australia. (Getty)

It might surprise you to learn that Australia is the world’s top producer of lithium, holding more than a quarter of global resources in the metal which is a key ingredient in the manufacture of batteries. 

Australia is also number one in rutile, a versatile material used in many everyday products including plastics and paints, and a top 5 producer of nickel, cobalt, zircon, manganese, and rare earths. 

These critical metals and minerals are in high demand due to their importance to the clean energy transition. The market size for these raw materials has doubled over the five years to 2022, reaching $320 billion, according to the International Energy Agency.

In that backdrop, it’s no surprise that the federal government is looking to leverage the nation’s wealth in these resources. It’s $22.7 billion “Future Made in Australia” plan aims to support the growth of a downstream processing and manufacturing industry that can supply growing global demand for clean energy technologies. 

The strategy is not without its risks. Prices have been volatile for many of these minerals and there’s always the chance that technological developments will reduce the reliance on any particular material in the manufacturing process. 

“Australia is well placed with our abundance of critical minerals and skills and experience in mining. But the transition will not be smooth and hence the pathway for the development and supply of these minerals will likely take a few twists and turns,” says Andrew Strongman, Head of Mining and Metals at Westpac Institutional Bank. 

“Westpac is continuing to work with companies as they navigate the ever-changing risk environment in pursuit of the growth required,” he adds. 

This infographic from Westpac Institutional Bank puts the scale of the opportunity in critical minerals into perspective:

Infographic: Future prospects for Australia’s transition minerals
 

James Thornhill

James Thornhill was appointed as editor of Westpac Wire in May 2022. Prior to joining the bank, he was a business and financial journalist with more than two decades of experience with international newswires. Most recently, he was a resources correspondent for Bloomberg, covering the mining and energy sectors, and previously reported on a broad range of topics from economics and politics to currency and bond markets. Originally from the UK, he’s had stints working in London, New York and Singapore, but is now happily settled in Sydney.

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