Australia Eyes Rare Earth Fund in Strategic US Minerals Deal

Australia Moves to Secure Rare Earth Supply Through Strategic US Partnership

Australia is preparing a significant push into the rare earths market, potentially partnering with the United States to ensure critical minerals security. According to The Age, the government is in early discussions to establish a $777 million rare earth fund, aiming to support local producers and counter China’s dominance in the sector. This move follows a leaked departmental brief that outlines a comprehensive plan, including minimum price settings and government-backed financial mechanisms.

The proposal includes a potential A$1.2 billion strategic reserve, price floors, offtake guarantees, and direct investment. These measures would provide a lifeline for Australian rare earth miners facing volatile global prices and limited downstream capacity. If enacted, the fund would place Australia in a stronger position to supply key minerals needed for EVs, wind turbines, and military technologies—especially to allied nations like the United States.

This initiative aligns with Washington’s own efforts to diversify supply chains for rare earths and other strategic materials. As geopolitical pressure mounts over China’s export controls, both nations appear motivated to reduce dependency on a single supplier.

Rare Earth Fund to Strengthen Australia-US Critical Minerals Alliance

The rare earth fund proposal surfaces as Australia repositions itself as a reliable supplier of strategic resources. Government talks with domestic miners signal a clear intention to build national stockpiles while securing long-term demand from allies. Meanwhile, US interest in the plan highlights the urgency of building diversified and resilient supply chains.

Beijing’s control over more than 80% of global rare earth processing has long been a concern for Western economies. With China implementing fresh export restrictions and the US signaling possible tariffs in retaliation, resource diplomacy has entered a new phase. The potential Australia-US deal would likely mirror recent moves by the US to support domestic mining and secure offtakes from partner countries.

If finalized, the rare earth fund could unlock new capital for Australian exploration and development. This would accelerate projects in regions like Western Australia and the Northern Territory, home to significant deposits of neodymium, dysprosium, and praseodymium.

SuperMetalPrice Commentary:

Australia’s proposed $777 million rare earth fund marks a strategic inflection point in global resource geopolitics. The timing—amid China’s export restrictions and increasing US trade assertiveness—suggests that Australia is positioning itself as a key supplier in the West’s push for mineral independence. For investors and miners alike, this could usher in a new era of state-backed stability in critical mineral markets. Expect increased M&A activity and renewed exploration interest across Australia as policy and capital begin to align.