US President Donald Trump and visiting Australian Prime Minister Anthony Albanese signed an agreement to increase access to critical minerals and rare earths as the United States seeks to reduce its reliance on Chinese supplies.
Trump said at a meeting with the leaders of the two countries at the White House on Monday: “In about a year, we will have so many critical minerals and rare earths that you won’t know what to do with them.”
Albanese said the deal represents an $8.5 billion “pipeline” and “we are ready to get it started”. He praised the minerals and rare earths agreement as raising economic and defence cooperation between the two countries “to a new level”.
The leaders of the two countries stated that the agreement would cover rare earth processing in Australia. Albanese also added that Australia is “capable” of expanding these efforts. According to the agreement text distributed by Albanese’s office, the United States and Australia committed to protecting their domestic markets from “unfair trade practices”, including adopting trade standards involving “price floors or similar measures”.
The Australian prime minister said that the agreement would start with the United States and Australia each paying more than $1 billion over the next six months for initial projects, followed by further projects in both countries and a development project to be carried out in cooperation with Japan. The document did not specify which entities would provide this financing.
According to the White House, as part of the agreement, the Pentagon will fund the construction of an advanced gallium refinery in Western Australia with an annual production capacity of 100 tons. The Export-Import Bank of the United States is also offering more than $2.2 billion in letters of intent for financing critical mineral projects.
After the agreement was signed, Arafura Resources Ltd. announced that the Export-Import Bank of the United States is considering providing $300 million in financing support for its Nolans project in Australia. Its share price once soared by 29%. The mining company, which is backed by Australia’s richest woman, Gina Rinehart, also received conditional approval for a $100 million loan from the Albanese government.
The Export-Import Bank of the United States also issued letters of intent to six other mining companies, seeking more than $2.2 billion in financing. The share prices of VHM Ltd. and Northern Minerals Ltd. rose by 30% and 19% respectively.
Lynas Rare Earths Ltd. is not currently a beneficiary of the fund, but it is the only heavy rare earth producer outside China. Its share price rose by as much as 4.7% on Tuesday before falling into negative territory. Shares of Iluka Resources Ltd., a mineral sands producer and potential buyer of rare earth mines, rose 9.1%.
