China blockade is a chance for Australia

The election promise of the Australian prime minister was submitted after it China They imposed export restrictions on seven minerals of rare lands, necessary in the advanced technologies industry, including in the production of electric vehicles, fighters and robots.

As BBC notes, restrictions are widely seen as retaliation for duties imposed by the president USA Donald Trump.

The reserve announced by Albanese is to gather the metals of rare lands, as well as other critical minerals, which Australia He is a leading producer, including LIT and Cobalt.

Metal reserves of rare lands are located in both China and Australia. However, 90 percent Rafination of rare earth metals, thanks to which they are later used industrially, takes place in China. So it is the Middle Kingdom that has real control over their global supply.

This situation worries Western countries, but above all representatives of the American administration. Analysts say that Washington's inability to secure the supplies of rare lands is one of the key challenges now facing the United States.

The director of Iron Ore Research in Perth in Western Australia Philip Kirchlechner in an interview with the BBC indicates that the US and the EU “gave the ball” China, accepting the dominance and monopoly of the Middle Kingdom in this area.

According to the US Geological Survey in 2019-2022, about 75 percent American imports of rare earth metal came from China. The expert indicates that China has begun to play a sensitive role in supplies for the American and European arms industry, which also uses these elements for production.

Also the general director of Tesla Elon Musk He complained that Beijing suspension of the export of rare earth metals affects the company's ability to create humanoid robots.

Albanese declared that metals from the future reserve will be available for both the “national industry and international partners.”

Kirchlechner admits that it is a good but “late” movement. According to the expert, the proposal “will not solve the problem”. The basic problem is that even if Australia accumulates more raw materials, the process of rare -rare metal refining will be significantly controlled by China.

A good example is a lithium that does not qualify for the metals of rare lands, but it is a key metal in the production of batteries for electric vehicles and solar panels. Australia extracts 33 percent world lithium, but it refins and exports only a small part of it. In turn, China mines only 23 percent world lithium, but refine 57 percent raw material.

However, Australian rulers are aware of this problem. Arafura Rare Earths from Perth in Western Australia received government funding in the amount of 840 million Australian dollars last year to create the first mine in the country and refinery of rare lands. In November, the first rare metal processing plant was opened, also in Western Australia, served by Lynas Rare Earths.

Experts, however, forecast that this country will be dependent on the refining of China at least by 2026.

Alicia Garcia-Herrero, the main economist for Asia and the Pacific at Natixis, indicates that Albanese's plan provides for the possibility of selling rare lands from Australia during economic turmoil. In her opinion, metals from Australia will not completely replace those from China.

– If the goal of Australia is to be on the services of the West, become a more important partner for the West – especially the US – these are weak points that China can use. And the most important of them is the refining – believes Garcia -Herrero.