Australia's governing Labor party has outlined its plan for a A$1.2bn ($720mn) critical mineral reserve from 2026, including offtake agreements to support project developments struggling to reach financial close, if it retains power in next month's election.
Labor's reserve plan only covers some of the 31 minerals listed on Australia's critical minerals list. The party stressed the importance of rare earths in its statement issued on 24 April but declined to specify which minerals will be included.
Labor will only be able to implement the plan if it is re-elected on 3 May. It is currently leading most parliamentary election polls.
The plan includes a limited mineral stockpile, as well as offtake agreements that could underpin the development of projects struggling to secure funds. There were 25 projects at advanced feasibility stage but not yet at financial close as of 31 October 2024, according to Office of the Chief Economist. Of these, 19 were rare earths, graphite, mineral sands, nickel-cobalt or vanadium projects, which would benefit from government offtakes (see table).
The plan also involves the Australian government selling reserves to Australian businesses and some international partners, as nations look to diversify supply from China. Labor intends to set up the critical mineral reserve in 2026.
The strategic reserve will mean the government has the power to purchase, own and sell critical minerals found in Australia, said the country's prime minister and Labor party leader Anthony Albanese.
Albanese pledged to create the reserve on 4 April in response to US president Donald Trump's "liberation day" tariff announcement.
Australia's federal government has supported critical mineral projects through grants and loans over the last three years. It also created a critical mineral tax credit in early 2025, covering 10pc of mineral processing and refining costs from 2027-28.
State governments are also supporting Australia's critical mineral producers. Western Australia's (WA) government created a A$150mn lithium support package in late 2024, offering producers interest-free loans and fee waivers. Multiple companies have applied for interest-free loans since then, the state's mining minister told Argus on 1 April.
| Critical mineral projects (Advanced feasibility stage) | |
| Mineral | No. of projects |
| Rare Earths | 6 |
| Graphite | 4 |
| Titanium and mineral sands | 3 |
| Nickel-cobalt | 3 |
| Vanadium | 3 |
| Other | 6 |
| Source: Office of the Chief Economist | |
