ASX miners rise to the occasion as the US gets serious about critical minerals

The US government took steps last week to bolster the domestic production of critical minerals and metals required for renewable technologies like electric vehicles. 

President Joe Biden authorised the use of the Defence Production Act, which gives Biden access to funding and other powers to provide more support for mineral exploration, processing, mining and recycling. 

“We need to end our long-term reliance on China and other countries for inputs that will power the future,” said Mr Biden last week at the White House.

Now that’s easier said than done.

In 2020, the US had a number of materials to which domestic production was practically non-existent.

Aussie miners rise to the occasion

Last week, US Commerce Secretary Gina Raimondo and Australian Trade Minister Dan Tehan met with several mining executives to discuss the rules that prevent US financing agencies from investing in Australia projects.

According to the Australian Financial Review, CEOs of 4 ASX-listed critical companies accompanied the minister on his trip. This included:

• Iluka Resources (ASX: ILU)

• Australian Strategic Minerals (ASX: ASM)

• Cobalt Blue (ASX: COB)

• Lynas Rare Earths (ASX: LYC)

Mr Tehran is hoping to lay the groundwork for rules for how US organisations can finance Aussie projects, in addition to a framework for how the US and other countries can do so.

Implications for ASX-listed miners

The ongoing Australia-US discussions is still a work-in-progress. However, these developments represent yet another vote of confidence for the supply-tight and critical nature of these materials.

Project financing is a risk for all exploration companies, but with the way things are going, it looks like there are plenty of investors and organisations willing to front up cash to help projects come online.