Ben Small (Forrest, Liberal Party) Share this | Link to this | Hansard source

I rise today to try to cut through some of the froth and bubble of the genuine excitement around Australia's critical minerals industry because, as the member for Forrest and a proud Western Australian, I'm acutely aware that a vast amount of our nation's critical minerals wealth actually sits below WA soil. Of course, the constitutional reality is clear. Those resources are vested in the Crown through the rights of Western Australia in trust for its people. That opportunity must be realised if we are to assert our sovereignty in a new and changing world.

I set aside some of the concern that people might have around the government's proposed critical minerals strategic reserve, which involves stockpiling, offtake agreements and other measures. There is a real perception that it makes the government a market player. The reason I set that aside is that the rare earths and critical minerals market is not a free market. The reality is that China absolutely monopolises the global market, with more than 90 per cent of the market share and a clear willingness to manipulate prices to their advantage. We can't have our heads in the sand and pretend that this is a free market in which everyone upholds the rules based order. Whilst there is the risk wherever government sticks its fingers into these things of undermining private enterprise and wasting taxpayer money, and success through resources has typically come from the simple principles that states regulate, private industry operates and markets decide, I actually agree with the government that that can't be the case here.

However, the reality, in my view, is that the government can't pick winners, and so the clear opportunity is rather to invest in research and development that will enable the industry to flourish here in Australia. Processing rare earths is technologically complex and, importantly, its also energy intense. So none of our collective ambition for critical minerals can succeed in this country unless we have affordable and reliable energy. Downstream processing and the transformation of these products into high-value products is dependent on our ability to have internationally competitive power costs.

If power costs remain high and supply unreliable, the reality is these projects will stall and remain commercially unviable. Our minerals will remain under the ground, unexploited and the opportunity goes begging, whilst other nations seize the opportunity and undermine our sovereignty. High energy costs are already a significant burden on the industry, and we've seen job losses in Western Australia already, with some 3,400 workers collectively laid off and their families impacted in the last year alone.