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Wednesday, November 30, 2022

The US is supporting important Australian mineral projects, and these ASX Mining Shares could be set to receive the award

Smiling Female South32 Miner With Mining Machinery In The Background.

Image Source: Getty Images

The Australian mining industry got some big news this week. Australian Trade Secretary Dan Tehan meets with US Secretary of Commerce Gina Raimondo in Washington DC. This was for the opening of the Australia-US Strategic Commercial Dialogue. According to the minister’s press release, Mr. Tehan was joined by the CEO to “participate in an important mineral roundtable from the critical minerals and rare earths sector”.

In a joint statement, Mr. Tehan and Secretary Raimondo said the following:

[We] Highlighted the commercial potential for both Australian and US industries and underscored the need to strengthen capabilities in all areas of the supply chain, including extraction and downstream processing. Australia and the United States will see how their respective financing mechanisms can be better coordinated and leveraged to support private investment in supply chains.

So it indicates that the US and Australian governments intend to work together to expand Australian production and processing of ‘critical minerals and rare earths’.

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Vital Minerals refers to the US government’s list of minerals that have been identified to “play a significant role in our national security, economy, renewable energy development and infrastructure”. The list now totals 50 different elements and minerals. These include cobalt, graphite, magnesium, nickel, lithium, neodymium, vanadium and zinc.

Which ASX Mining stocks could benefit from a focus on critical minerals?

Therefore the governments of both the US and Australia are now focusing on developing domestic mining and processing facilities for as many of these minerals as possible. This is partly because many global supply chains currently pass through China. This situation is increasingly being seen as a strategic problem. This could have major consequences for Australian mining stocks.

Lithium shares are a clear beneficiary. ASX is home to many of these. the most important of which is Pilbara Minerals Limited (ASX: PLS). but we also have Mineral Resources Limited (asx:min) and AVZ Minerals Limited (ASX: AVZ).

ASX is also home to some cobalt miners. Cobalt Blue Holdings Limited (ASX:COB) has been in the news lately after the government accorded it ‘major project status’ earlier this month.

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Earlier today, we looked at some ASX vanadium miners. one such share Neometals Limited (ASX:NMT).

Nickel Share Like Nickel Mines Limited (ASX:NIC) has also been gaining attention recently.

And then there’s the Rare Earths Company. Linas Rare Earths Limited (ASX: LYC). Linas is one of the only significant producers of rare earth elements such as neodymium outside China.

So all of these ASX resource stocks have the potential to benefit in the medium to long term from the news coming out of the trade minister’s office this week. Many people have already received aid from governments. And many more may join them in future. Given the current geopolitical climate, critical mineral protection is certainly a hot topic at the moment. Thus, it is a place that is worth keeping an eye on.

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