Playing field levels out for Australian critical minerals producers

A combination of carrot and stick diplomacy is setting Australia up as a winner in the critical minerals space. That comes from Broken Hill based Cobalt Blue which describes itself as is one of a handful of companies in the world able to effectively produce large scale, battery-grade cobalt. The world’s largest cobalt supplier is the Democratic Republic of Congo which the European Union could avoid or penalise for unsustainable mining practices said Chief Executive Officer with Cobalt Blue Holdings, Joe Kaderavek. On the other hand, tax credits provided by the US Government to incentivise critical minerals mining, processing and trade will act as a big incentive, Mr Kaderavek said. CEO Cobalt Blue Holdings Joe Kaderavek They are being focused on countries, like Australia, which have a Free Trade Agreement with the US and include tax credits of $3750 awarded to the purchasers of electric vehicles, including those bought in Australia. Related: 29Metals eyes cobalt opportunity at Capricorn Copper “That $3750 is half of the overall tax credits towards the battery, with those tax credits given to the purchasers,” Mr Kaderavek said. “They're given to the vehicle purchaser at the lot (purchasing point), from 2024-2032 provided firstly 60 percent (by 2024) then 80 percent (by 2026) of those critical minerals, the lithium, the nickel, the cobalt, the manganese, and other minerals are sourced either from FTA countries, of which Australia is one, or processed in an FTA country. “Australia's in a very strong position of being both an FTA country for source, but also a stable sovereign jurisdiction where US partners and other partners looking to sell into the US market, can build capacity in Australia in the downstream.” Not all smooth sailing There were challenges including a tight timeline said Mr Kaderavek. “It's clear from our industry relationships that the 2024 deadline is going to be almost impossible to meet,” he said. “And even the 2026 deadline is getting significant pushback. It's deemed by the industry to be a good move, but too aggressive. “The timeframe is a US Treasury/Dept of Commerce estimate deemed to be the minimum required to build these new supply chains.” Australia had around 16 percent of the world’s total global resource according to the US Geological Survey yet contributes only 4 percent of global production. “In terms of economics, because non-African ore grades don’t meet the high-grade ores that they have in the African copper belt, particularly the DRC, it's very difficult basis to compete with cobalt produced from the DRC.” “And that's on head grade, but obviously then there're people costs, et cetera, that are a lot cheaper over there. “On a like for like basis, it would be difficult to compete on pure economics, but going forward with better technology, incentives locally, but also clearly global demand incentives, if I can call the US and EU governments that, that'll level the playing field out very nicely.” Queensland had a inherent advantage in this space, with more than 200,000 tonnes of cobalt metal equivalent in tailing dams and waste dams in in the North West said Mr Kaderavek.

Playing field levels out for Australian critical minerals producers

Industry Queensland

Related News

Quick fire – industry news briefs

Fraser Institute rankings highlight global competition

Pybar tapped for new mine job as AIC gets ducks in a row

Get access to breaking mining news, now.