Trump administration looks to Australia for rare earths to avoid Chinese extortion

Australia could be a major source of the rare earths being withheld by China, a top White House official said Monday ahead of a visit from Australian Prime Minister Anthony Albanese. Here’s what you need to know about the U.S.-Australia rare earths partnership and efforts to reduce dependence on China:

Australia as rare earths alternative

White House official highlights Australia’s mining capabilities:

• Australia could be major source of rare earths being withheld by China, top White House official said Monday ahead of visit from Australian Prime Minister Anthony Albanese
• Kevin Hassett, director of National Economic Council, said Australia has one of “best mining economies on Earth,” smartest refiners and “lots and lots of rare earths”
• He said issue will come up during Mr. Albanese’s meeting with President Trump at White House on Monday
• “Australia is really, really going to be helpful in effort to take global economy and make it less risky, less exposed to kind of rare earth extortion that we’re seeing from Chinese,” Mr. Hassett told White House reporters

China’s rare earths dominance

Beijing clamps down on critical mineral exports:

• Beijing recently clamped down on China’s export of rare earth elements that are used in smartphones, electric vehicles, lasers and military technology
• China has stranglehold on production of rare minerals and metals, whose atomic structures give them unusual powers
• Situation put spotlight on globe’s reliance on China for rare earths

Trump’s retaliatory measures

100% tariff threat over rare earths restrictions:

• Mr. Trump threatened to impose 100% tariff on Chinese goods, on top of existing levies, in retaliation, though both sides could work something out before implementation date of Nov. 1

Alternative sources being explored

Administration seeks domestic and allied options:

• Trump administration is looking for alternate sources, including rich deposits of rare earths in Mountain Pass, California, though Mr. Hassett said Australia is another option
• “I think there’ll be lot of conversation about that matter today,” Mr. Hassett said

Australia’s rare earths potential

Nation positioning itself as critical minerals superpower:

• Australian officials believe their nation can become rare earths superpower, supplying more than 30 of critical minerals U.S. wants and needs
• Australia recently created critical minerals reserve
• However, it needs to expand its processing and refining capabilities to compete with China

Broader trade discussions

Albanese seeks tariff relief on certain products:

• More broadly, Mr. Albanese and Mr. Trump are set to discuss whether Australia deserves relief from certain U.S.-imposed tariffs
• U.S. had trade surplus of nearly $18 billion in 2024, so Australia only faces Mr. Trump’s baseline tariff 10% on products it sends to U.S.
• Key imports such as steel and aluminum are subject to high, sector-specific tariffs imposed by Trump administration, so Australian may seek exemptions

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• Trump team looks to Australia for rare earths to avoid Chinese ’extortion’