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Morrison pledges $1.3bn to rare earths sector in bid to restart economy

March 10, 2021

Morrison pledges $1.3bn to rare earths sector in bid to restart economy

Reducing carbon emissions will become a key part of Australia’s COVID-19 economic recovery plans, Prime Minister Scott Morrison has said.

Reducing carbon emissions will become a key part of Australia’s COVID-19 economic recovery plans, Prime Minister Scott Morrison has said.

Speaking at the Australian Financial Review’s Business Summit 2021 on Tuesday, Mr Morrison said the Federal Government will place its support behind reliable, lower emissions energy as part of its economic recovery strategy.

Mr Morrison added that “the world’s response to climate change is simultaneously reshaping the global economy, global politics and the global energy system”.

Reducing emissions, as well as seeking to become a world leader in research and development, will both become focuses of the governments recovery plans moving forward.

Mr Morrison’s comments come fresh on the heels of a new $1.3 billion grants package for the rare earths and critical minerals industry, announced on Thursday, March 4.

The funds are part of the new Resources Technology and Critical Minerals Processing road map, a ten-year strategy intended to help Australia grow its manufacturing sector and add value to the materials dug out of the nation’s soil before exporting them to foreign markets.

The grant money will be made available to projects in ‘priority areas’ to help them scale up, commercialise their products, and access global markets.

Producers of rare earth minerals – core ingredients in a range of clean energy technologies – are expected to benefit from the funding.

 

Rare earths market charges up

The market for rare earth elements is tipped to grow into a USD $20.6 billion industry by 2025 (a compound annual growth rate of 10.4% from 2020) spurred on by the global transition to renewable energy.

Rare earth elements – particularly neodymium and praseodymium (collectively referred to as ‘NdPr’) – are crucial components of renewable energy technology.

Electric vehicle drive trains require 2 kilograms of NdPr, while a three-megawatt direct drive wind turbine needs as much as 600 kilograms.

Currently, China controls 90% of the global rare earth mineral production, and has routinely leveraged its economic control to deter competitors or penalise the US and Japan over political disputes.

And with demand set to grow, analysts forecast the annual NdPr supply shortfall to reach 16,000 tonnes by 2030.

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