Bold claim: Australia and Canada could spark a critical minerals powerhouse, reshaping global supply chains and challenging existing dominance. Now more timely than ever, this idea is moving from theory to potential policy and practice.
In the near future, Canadian Prime Minister Mark Carney is set to address the Australian Parliament, focusing on the evolving partnership between their nations. Earlier, Carney—who once led the Bank of Canada and the Bank of England—delivered a landmark World Economic Forum speech that challenged the traditional rules-based order and urged medium powers to form new strategic loyalties. That address reportedly ruffled feathers in Washington, including US President Donald Trump. The controversy cooled somewhat when the US Supreme Court later curtailed a central pillar of Trump’s tariff strategy, signaling shifts in global trade dynamics.
Amid these geopolitical tremors, Australia and Canada quietly deepened their cooperation on critical minerals, signing a bilateral pact last October to collaborate across everything related to this strategic sector. This agreement may foreshadow broader shifts in how Western allies align on resource security.
A notable policy rethink has emerged from the Australian Strategic Policy Institute, a think tank largely funded by the Department of Defence. Its latest report argues Australia should rethink its alliance playbook. Rather than leaning heavily on Washington for critical-minerals partnerships, Canberra should elevate Canada, alongside Japan, South Korea, and Malaysia, as preferred partners in a diversified strategy.
From rivals to partners: Canada and Australia sit at the heart of the world’s mineral story. They host major mining companies, lead in exploration and production, and command sophisticated capital markets for extractives. In their new study, Disruption and Opportunity: Australia and Critical Minerals in a Changing Global Order, Ian Satchwell—Adjunct Professor at the University of Queensland—cautions that relying on the United States for all critical-minerals partnerships is risky. He notes Australia has more than 60 agreements with the US, the EU, and other nations, many of which remain underused rather than fully activated.
Satchwell urges Australia to pivot from signing partnerships to truly leveraging them. He also advocates looking north to Canada and to Asia’s buyers—Japan and South Korea—who have both the demand and the financial heft to support large-scale supply. In his view, Canada, as Australia’s closest minerals peer in scale, capability, and sustainable mining commitment, should be treated not as a competitor but as a strategic collaborator in building shared, resilient supply chains.
The American market will remain important for some minerals, but not all. Policy uncertainties in Washington mean Australia should cultivate multiple markets to reach the necessary scale.
China looms large in this calculus. While diversification away from Beijing is essential, China is likely to stay an indispensable end market for Australian minerals. The key challenge is that China’s control over refining and price-setting gives it outsized influence over global supply chains, creating what Satchwell calls an “existential threat” to other producers. He notes China’s dominance in refining for many critical minerals and even greater leverage over traditional metals. This has allowed Beijing to shape prices and, at times, constrain rivals.
The consequence is a delicate juggling act: strengthen ties with Western partners like the US, while actively pursuing alternative markets and collaborators to reduce exposure to China’s market power. Notably, some Australian firms faced price pressures during critical development phases when market dynamics shifted, underscoring the importance of diversified demand.
So, where does that leave Australia?
The answer lies in strategic diversification. By forming robust partnerships with Canada and cultivating demand from Japan and South Korea—nations seeking dependable, high-volume mineral supply—Australia could become a pivotal link in a diversified, resilient global supply chain. Australia’s abundant mineral reserves and proven extraction expertise position it well to lead in discovery, development, and initial production. However, Satchwell cautions against assuming that more refining and manufacturing will naturally follow from partnerships with the US alone. The US market will continue to prioritize its own processing needs, given supply-chain security imperatives.
The recommendation is clear: pursue the United States’ minerals investment framework, while also expanding engagement with Canada, Japan, South Korea, and other markets offering clearer pathways to scale. Diversifying away from China and the US won’t be simple, but it is essential for Australia’s long-term stability and growth.
Ultimately, the question for Australia isn’t whether to become a critical-minerals superpower, but whether to become an indispensable node in the world’s most strategic supply chains. This framing is exactly the kind of language that resonates with leaders like Carney and could steer policy toward a truly multipolar, resilient minerals economy.
