US, Australia ink rare earths deal to curb reliance on China amid rising trade tensions

Time now for a check on the day business news with our business editor, Brian Quinn. Brian, good to see you. Starting with a major new deal between the US and Australia as they look to chip away at China’s dominance in the rare earth mineral sector. Indeed, Dano, Australian Prime Minister Anthony Albanese was in Washington Monday meeting with Donald Trump. The two leaders there inked a new deal that will see a billion dollars invested over the next six months to support an $8.5 billion portfolio of new mining and processing projects in Australia. Natasha Lee reports. Heavy metal. A major new deal aimed at breaking China’s grip on a critical lynchpin of the global economy. Washington and CRA are partnering up to develop Australia’s rare earth sector. Part of this deal is very specific. $ 8.5 billion pipeline. There will be a billion dollars contributed from Australia and the United States. Over the next six months with projects that are immediately available, using everything from smartphones to submarines, rare earths are essential for global technology and defense. With China controlling 70% of the mining and 90% of the processing, as the trade war between Washington and Beijing heats up, China has further tightened its grip on rare earths. It now requires export licenses not only for the raw materials, but also for the technology used in processing and for the end products. This new agreement is expected to unlock billions in investment, but analysts say it will take time to have a real effect. Yeah, I don’t think this is a quick fix, but directionally I think uh you know I think this this is um a much better situation for uh diversifying the the supply of these minerals than we had before these agreements. The deal also strengthens the AA security pact, a trilateral agreement with the UK that will see Canberra purchase US nuclear submarines and upgrade its naval fleet with American technology in a bid to counter China’s military influence in the Indo-Pacific. A deal with military weight as two allies double down on resources, resilience, and regional power. Well, Australian mining firms got a big boost from that rare earth’s deal. Smaller producers like MRO Magnesium and VHM saw huge pops of 15 and 20% respectively. The ASX S&P 200 up 7/10en of a percent at the close. Here in Europe, major indexes making some small gains as defense shares on the continent retreat after getting a big boost Monday from a fractious meeting between Donald Trump and Vadimir Zilinski over the weekend. Shares in German warship firm TKMS soared on their first day of trading Monday after being spun off from German industrial giant Tusenrip. Those shares are down nearly 6% so far Tuesday though. Finally for business, Amazon says its cloud computing service has recovered after a widespread outage knocked many internet sites offline. No evidence of foul play has been reported and Amazon Web Services says the DNS issue it suffered has been quote fully mitigated. The outage though serves as yet another reminder as just how much of the global economy has become increasingly reliant on a handful of big tech companies. Faro Mar has more cut off from their favorite video games, language learning apps, social media outlets, and important online tools as Amazon web service outages knocked them offline. The company says a technical issue which originated in Virginia prevented applications from accessing an interface that connects computers to each other. The head of an internet performance monitoring firm says the malfunction will have major consequences. The financial impact of this outage will easily reach into the hundreds of billions due to loss and productivity for millions of workers that cannot do their job, plus business operations that are stopped or delayed from airlines to factories. While some apps were back up and operational during the day, they experienced a resurgence in the same problems hours later. The incident highlights the dependence of governments, businesses, and individual users on its cloud services. Microsoft Azour, Google Cloud, and Amazon Web Services account for more than 60% of the cloud computing market. Amazon is the industry leader with more than 1 million active monthly users. We live in an era right now where we are very dependent on the cloud providers. So, we need them to be at the top of their game. And today, Amazon was not. It’s the first major global internet disruption since cyber security and tech company Crowdstrike distributed a faulty update last year, which crashed millions of systems impacting operations in banks, hospitals, and airports. And it really is Don a handful of mostly American giant uh tech companies that run much of the cloud infrastructure that almost everything that we use on the internet to get things done, especially economically, uh run on. So, so strategic vulnerability there and the governments are dependent on it as well. So, we’ll see um what steps they take to mitigate in the future. Thank you very much for that, Brian. Brian Quinn there with the business news. More news coming up. Stay with us.

Washington and Canberra have signed a new agreement to strengthen cooperation on rare earths and critical minerals, in a bid to reduce dependence on China’s supply chains. The deal, promising billions in potential investment, highlights efforts by both nations to secure vital resources amid escalating trade tensions with Beijing. Also in this edition: Amazon Web Services experienced a major outage on Monday, briefly disrupting internet traffic worldwide before the issue was resolved.
#USA #Australia #rare earths

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23 comments

  2. It will take a decade or more on if (big IF) they start now with the right expertise, tools and infrastructure. I very much doubt they can break that reliances even in the next two decades…

  4. This is a complete beat up by the Australian PM and Trump. There is nothing in the minerals deal which suggests anything material will happen for a long time. In fact, it's the processing of the minerals which makes them 'rare' and this is in the hands of China and will be for many years. Australia is unlikely to have the expertise or infrastructure to do the complex task of processing: it currently contributes 0.5% of world manufacturing, less than countries such as Indonesia, Vietnam and Bangladesh.
    The AUKUS deal means little more than Australia will hand over billions of dollars to the US and UK for many years and a submarine will only be delivered if the US Congress agrees that the US can spare one. Seeing that the US is miles behind in its building program, this is very unlikely.

  6. dangerous move to sign with america .america will not stand with australia america is not acting like a allie so i would trust china but it seems white man stay with white man sad to see

  10. You can always tell when a deal is good because the China bots come out in force saying it won't work or its the worst thing ever or a bad deal.

  12. well since you got the stuff from Australia, China's export control won't be an issue. Just hang in there for a while and you will be fine😂

  14. It seems to me that China has the US and the west by the scrotum. From all I've learned in the past few years when I 1st heard about the REEs it seemed like this is where it would eventually go. At best the US can produce the REEs they need, at scale, in a decade but at worst they're 20-25 years behind. They've got work to do. By that time China may be untouchable and reunited with Taiwan

  15. 澳大利亚的氧化镝只能出99.9的纯度，而中国是99.999%，只有5个9才能用于航天军工😅，3个9连永磁体和半导体上都不够级别！这种水平只相当上世纪90年代😅😅😅😅

  16. The Australian deal is important. Other deals, like with Ukraine are very long term. The Australian deal starts immediately and will be providing significant quantities before the end of the decade, with Australia and the US expected to be processing up to 15% of the global supply by then, and still ramping up production. It is enough to break the Chinese monopoly.

  18. 日本国内での意見は、レアアースが売れない中国の在庫がたくさん出て大変なんじゃないかと言われています😂

  21. To refine it, you will need:
    1. Technology(85% patterns owned by Chinese)
    2. Equipment (manufactured by Chinese)
    3. Enormous power supply (green energy, nuclear energy produced by Chinese)
    4. Enormous market(search byproduct of electrolytic aluminum)
    5. Environmental protection/waste management (you should ask China for help)

  22. Australia pay $38B every year to the indigenous people yet borrow billions from China to build our infrastructure like rail. Melbourne has spent billions on new roads, bridges and underground train stations that are amazing and 100% better than American subways.
    Our grandchildren will still be paying this debt because our politicians are the dumbest on the planet.

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