The European Union (EU) is veering away from its reliance on Russia for raw critical minerals, instead looking to Australia to become its next supplier.
As the war in Ukraine continues, Australia and the EU have been brought closer together in a move that would see Australia be a prime supplier of lithium and cobalt, as well as iron ore.
Head of trade and economics at the EU Delegation in Australia Cornelis Keijzer said Australia’s sanctions on Russia have also factored into the EU’s thinking. The EU currently relies on Russia for energy and raw materials.
“We’re looking for new sources,” Keijzer told Nine Newspapers. “So that is what we’re looking for from Australia: the possibility to source those raw materials now from Australia.
“Things like lithium, cobalt, critical materials, but also iron ore. We want to buy from Australia, no longer from Russia.”
According to Federal Trade Minister Don Farrell, Australia would be keen to start supplying the EU.
“One of the things that I think we’ve learned over the last few years is that by having all your eggs in one basket, you put yourself in a precarious position,” Farrell said.
Common critical minerals include cobalt, lithium, nickel, vanadium, tungsten, magnesium, graphite and rare earths.
They are used in low-emission technologies such as electric vehicles, wind turbines, solar panels, and rechargeable batteries, and are viewed as a vital component of the drive towards the world’s green transformation.
And Australia has a key role to play in that transformation. The Federal Government’s $1.3 billion Modern Manufacturing Initiative (MMI) is supporting new Australian technologies and innovations to come onstream.
Farrell said he was optimistic that negotiations are heading in the right direction.
“Certainly the vibe coming from the Europeans is that they want to do this deal,” he said after speaking with European counterparts at the World Trade Organisation meeting in Geneva.
While there is currently no set deadline on the deal, Keijzer hopes for “decisive progress” by early 2023.
“In terms of a provider of some of these very strategic raw materials, [Australia] is important,” he said.
“Australia is also important as a customer; we do sell a lot of goods in Australia. So there’s an interesting trading relation that can still be more developed, we think, especially as the Australian economy has a need for more diversified customers.”