Australia-US Critical Minerals Deal Boosts Rare Earths and Gallium Projects

Australian Mining Sector Sees Historic Boost from Critical Minerals Deal

The Australia-US critical minerals deal, announced by President Trump and Prime Minister Albanese, ignited strong optimism in the Australian mining sector. Investors and companies praised the agreement as it enables direct funding and commercial contracts. The deal also emphasizes preferential treatment of Australian critical minerals to the U.S., enhancing national security and supply chain reliability.

Association of Mining and Exploration Companies CEO Warren Pearce highlighted that the agreement exceeded expectations. “The deal provides investment commitments alongside supply arrangements,” he said. The announcement dominated discussions at IMARC, Australia’s largest mining conference, showcasing immediate industry excitement.

Key Winners: Arafura Rare Earths and Alcoa-Sojitz Gallium Project

Arafura Rare Earths (ASX: ARU) emerged as a major beneficiary, receiving a $300 million letter of interest from the U.S. Export-Import Bank for its $1.2 billion Nolans project. The project will produce 4,440 tpa of neodymium-praseodymium and 573 tpa of mixed rare earth oxides. CEO Darryl Cuzzubbo emphasized the unprecedented government cooperation and accelerated project timelines.

Meanwhile, Alcoa (NYSE: AA) partnered with Sojitz Corp (TYO: 2768) and the Japanese government to produce gallium at its Wagerup refinery. The deal, backed by up to $200 million in concessional equity finance, will secure a strategic gallium supply outside of China, representing roughly 10% of global production. Production aims to commence by 2026, giving first-mover advantage to the consortium.

Strategic Investments Across Australia’s Critical Minerals Projects

The deal also extends support to six additional projects, including Graphinex, Northern Minerals, La Trobe Magnesium, VHM, RZ Resources, and Sunrise Energy Metals. Funding through EXIM letters of interest totals $2.2 billion, supporting graphite, scandium, magnesium, and rare earths initiatives across multiple states. These investments accelerate construction schedules and strengthen the U.S.-Australia supply chain for critical minerals.

SuperMetalPrice Commentary:

This deal marks a historic milestone for Australian mining and U.S. strategic resource security. By securing rare earths and gallium outside China, both nations mitigate supply risks amid rising demand for EVs, semiconductors, and defense technologies. Investors should monitor project timelines closely, as first-mover advantages could dictate global market positions over the next decade.