Australia’s government has announced plans to establish a $1.2 billion (USD 760 million) strategic reserve of critical minerals, aiming to reduce dependence on China and strengthen the country’s position in global supply chains. Prime Minister Anthony Albanese detailed the initiative on April 24, stating that the reserve will focus on 31 minerals vital for modern technologies, including lithium, cobalt, and rare earth elements, which are essential for electric vehicles, renewable energy systems, and defense applications.
The reserve will operate by purchasing agreed volumes of critical minerals from commercial mining projects or securing options to buy them at fixed prices. Stockpiles will be created to support both domestic industries and international partners, with the government expecting the reserve to become operational in the second half of 2026. The plan also includes a $1 billion increase to the existing Critical Minerals Facility, bringing total investment in the facility to $5 billion.
Australia holds some of the world’s largest reserves of critical minerals, but most processing currently takes place in China, which dominates the global market for rare earths and other key elements. The government’s move comes amid ongoing trade tensions and export restrictions imposed by Beijing, which have highlighted vulnerabilities in international supply chains.
Industry groups have welcomed the plan, noting it could provide market confidence and attract investment to new mining projects by stabilizing prices and guaranteeing demand. The reserve is also expected to give Australia greater leverage in trade negotiations, particularly with the United States, and to support the development of domestic processing capabilities.
Consultations with states and industry stakeholders will determine which minerals are prioritized and how the reserve is managed. The opposition has indicated openness to developing a similar reserve if elected, emphasizing the importance of international cooperation with partners such as the US and Japan.
