The government will launch a new billion-dollar program to support businesses with grants of up to $20 million to translate potential new opportunities into commercial realities.
Prime Minister Scott Morrison said the government was focused on continuing to rebuild and grow the economy with manufacturing playing a key role in the COVID-19 recovery.
He said the initiative would help position Australia as not just a global leader in the resources sector but also in the manufacturing of the technology used, as well as turning the raw materials into value-added products.
“Today’s funding will help unlock investment from industry to help build manufacturing capability and competitiveness in Australia’s resources sector while taking advantage of a significant global growth sector,” Mr Morrison said.
“This investment and this roadmap will support jobs across Australia, particularly in our resource-rich regions like the Hunter, Western Australia and Central Queensland.”
While Australia has some of the biggest reserves of many critical minerals, their scarcity and the lack of processing facilities leaves them potentially vulnerable to supply constraints and shortages.
Many countries with specific economic and industrial development requirements are starting to take a more strategic approach to ensure security of supply of these minerals. They include efforts to diversify supply and to source from countries with the geological capability to satisfy critical minerals demand.
In the battery technology value chain, the Future Battery Industries CRC believes Australia can compete effectively in a number of areas including BHP’s progression of a nickel sulphate refinery at Kwinana, Western Australia.
It has also identified greater opportunities in battery assembly, identifying the potential to expand and grow domestic assembly projects which are currently occurring at Magellan Power in Western Australia and Feline in Queensland.
The ability to move into manufacturing is dependent on the ability to process these chemically complex raw materials competitively. There are only a handful of established processing projects in Australia, with some companies undertaking definitive feasibility studies and are at the stage of attracting offtake agreements and project finance.
But many face technical and market barriers to scale operations including substantial investment overheads to establish mineral processing facilities and build appropriate domestic capabilities in Australia.
Industry argues that to secure market share and more downstream activities, manufacturers need to demonstrate a reliable processing capability and the ability to scale to meet specific customer requirements. Those factors make it difficult to access finance without public funding and risk-sharing.
Start your day informed
Our Morning Edition newsletter is a curated guide to the most important and interesting stories, analysis and insights. Sign up to The Sydney Morning Herald’s newsletter here, The Age’s here, Brisbane Times’ here, and WAtoday’s here.
Rob Harris is the National Affairs Editor for The Sydney Morning Herald and The Age, based at Parliament House in Canberra