US-Australia $8.5B Critical Minerals Pact Seeks China Supply Chain Break

The recent US-Australia critical minerals agreement aims to diminish China's dominance in global supply chains by investing in mining and processing projects in Australia, with a $3 billion commitment and a total $8.5 billion pipeline of projects. This pact includes funding for key projects like the gallium refining plant in Western Australia and the Arafura Rare Earths neodymium and praseodymium production, crucial for tech and defense sectors. While the deal is expected to strengthen supply chains and reduce reliance on China, experts caution that overcoming China's established technical and production advantages will take years, with project timelines extending to 2027 or beyond. China currently controls the vast majority of refining capacity, mining, and magnet production globally, posing a significant challenge to Western efforts. Industry stakeholders emphasize that success depends not only on new production capacity but also on buyers' willingness to shift away from cheaper Chinese sources. The agreement also reinforces strategic cooperation under the AUKUS defense pact, highlighting the geopolitical importance of securing critical minerals supply.