Photo of critical minerals

The government will support Australian critical minerals processing as a priority under the Future Made in Australia Investment Framework. New Budget measures and existing critical minerals programs support industry to build sovereign capabilities.

Critical minerals are essential to Australia’s economic sovereignty and clean energy transition. 

Australia has rich ore reserves in critical minerals and the potential to become a leading producer and exporter of processed critical minerals. Australia’s Identified Mineral Resources 2023 shows that in 2022:

  • Australia retained its position as the world’s top lithium producer (52%) 
  • Australia was a top five producer for cobalt (3%), manganese ore (10%), rare earths (5%), rutile (27%), tantalum (4%) and zircon (25%). 

The production of critical minerals is concentrated in a small number of countries outside Australia, making their supply vulnerable to trade disruption. Encouraging processing in Australia will support the resilience of critical mineral supply chains while helping Australian firms move further up the value chain.

This Budget progresses the objectives of the Critical Minerals Strategy 2023–2030 including by:

  • supporting Geoscience Australia to comprehensively map Australia’s natural resources, including critical minerals necessary for the net zero transition and a Future Made In Australia
  • establishing tax incentives that build sovereign capability in critical minerals processing
  • building scale and efficiency through common user processing facilities 
  • attracting investment and backing our critical mineral sector to grow
  • supporting our trade partnerships to grow opportunities for Australia’s critical mineral products
  • safeguarding our critical minerals businesses against foreign interference.

Resourcing Australia's prosperity 

The government is providing $566.1 million over 10 years from 2024-25 for a new Resourcing Australia’s Prosperity initiative

This will enable Geoscience Australia to comprehensively map Australia’s natural resources and accelerate the discovery of critical minerals.

Offering tax incentives

The government will provide $7 billion over the decade to 2033-34 through the new Critical Minerals Production Tax Incentive (CMiPTI). 

It will provide a refundable tax offset of 10% of eligible processing costs for all 31 critical minerals currently on Australia’s Critical Minerals List

The CMiPTI will start on 1 July 2027. The government will consult on final eligibility criteria, administrative arrangements and legislation ahead of time.

Investigating common user processing facilities

The government is investing $10.2 million to establish the Critical Minerals National Productivity Initiative (CMNPI). 

Through this initiative, we will partner with states and territories to identify potential common user facilities for critical minerals processing. These facilities, when developed, will support small and medium sized mining companies to undertake downstream processing of critical minerals. The facilities will also support companies to engage in the circular economy through recycling and reprocessing waste and mining byproducts.

The focus will be on small scale projects that create the enabling environment for facilities that could be quickly established to support multiple minerals and mining companies. Working with state and territories, the government will advance initial proposals through to detailed economic feasibility studies to support the critical mineral move down the value chain.

Financing projects

The Critical Minerals Facility and the Northern Australia Infrastructure Facility are supporting the critical minerals industry to build sovereign capabilities. Finance from these facilities has contributed to:

  • providing approximately $840 million to Arafura Rare Earths’ Nolans Rare Earths Project in the Northern Territory
  • providing $400 million for the Alpha High Purity Alumina (HPA) – HPA First Project in Queensland,
  • revising previously approved finance of $185 million to Renascor Resources for its Siviour Graphite project in South Australia.

Austrade’s Critical Mineral Prospectus demonstrates the investment opportunities in over 52 advanced critical mineral projects. 

Supporting trade partnerships

The government is providing $5.8 million over 3 years from 2024-25 for a critical minerals trade enhancement initiative. Our department and the Department of Foreign Affairs and Trade will implement the initiative.

This will help our efforts to grow trade partnerships that support a future made in Australia. It will also enhance Australia’s competitiveness in international markets for sustainably produced critical minerals and downstream products. 

Safeguarding against foreign interference

Our department will receive $1 million over 3 years from 2024 for a pilot program to strengthen the capabilities of Australia’s critical minerals sector to detect, prevent and mitigate foreign interference. The program will provide education and training through a virtual outreach service to individual critical mineral companies.

As a high priority sector, failure to arm the sector with these capabilities could have economic and national security consequences.