NARELLE GRAHAM, HOST: First this hour more detail for you on the critical minerals deal that Australia has done with the United States, and importantly, what it's likely to mean for South Australia and Far West New South Wales. 

The Federal Minister for Industry and Innovation, Tim Ayres, travelled with your Prime Minister, Anthony Albanese, for that meeting with Donald Trump, and Federal Minister, Tim Ayres, is happy to speak on this topic this afternoon. 

Minister, good afternoon. 

SENATOR TIM AYRES, MINISTER FOR INDUSTRY AND INNOVATION AND MINISTER FOR SCIENCE: G'day, how are you going? Good to be on the show. 

HOST: Thank you very much. What are the rare earths, the critical minerals that are covered by this agreement? 

AYRES: Well, there's a very long list of rare earths that Australia has in vast quantities. I think the Prime Minister likes to say we've got the whole periodic table underneath the ground in Australia. 

One of the programs that we announced in, I think the last budget, was a program of geological mapping of the whole continent to make sure that we're on top of all of the reserves that are there available for industry. And the Prime Minister, this Government wants to see us not just exporting ore overseas, which invariably in today's economy ends up in one market in China being processed, but to make sure that Australia is onshore processing, turning ores into high value metals; that's in the interests of regional jobs, but it's also in Australia's national interest, and it's good for our economic resilience. 

HOST: So Minister, given that the geological mapping of the whole of the continent needs to still be done, are you able to say of the minerals that are covered by the agreement, and if it's a long list we won't get into them, but are there particular ones that you know of that are found in South Australia and Far West New South Wales? There has been some exploration work that's been done here in the past. 

AYRES: Yeah, there's a lot of examples. I mean straight away on the list of projects that are being funded already, the package that we delivered for Nyrstar's Port Pirie project was based in part upon their capacity to produce the antimony metal. Antimony's a rare earth metal that is most cheaply found in lead smelting processes and in gold smelting. It's critical for military technology. 

That plant will produce at the end of this project about 5,000 tonnes of antimony a year. It doesn't sound like a lot, but that is 40 per cent of the US's requirement, for example. So, it's a strategic Australian position in a metal that is overwhelmingly today produced inside China's vast mineral processing capability. 

The Copi mine, south of Broken Hill, will be producing titanium and zircon products used in electronics, magnets, night vision, precision guided missiles, that kind of technology, and you know, South Australia is in a really strong position on these questions with its existing mining sector to make sure that we're value adding more, more in Australia and more in regional South Australia. 

HOST: Tim Ayres is the Federal Minister for Industry and Innovation. If you have particular queries to do with the critical minerals deal that has been done with the United States, 0467 922 783 is that text line number for you. 

There's a likely impact of critical mineral mining and processing on our environment, and possibly farmland. So after the deal was struck, I spoke with Ausmon Resources who have been doing some work, some exploration work around the south east of South Australia for quite a number of years, and I know that in Victoria I've seen farmers posting on social media about their concerns with what might – what this package might mean for them and their farmland. So how do you ensure that the environment and farmland – how will those be protected? 

AYRES: Well, all the environmental approvals that apply to mining and any industrial project in Australia will apply to these projects. They are of national significance, it is in our national interest and our future economic resilience interest that these projects proceed, but they must satisfy all of the normal environmental approval requirements. So, Australians listening to this should be confident we're going to follow through that process. 

But we are determined as a government to secure Australia's manufacturing future by delivering these projects. The agreement signed by the Prime Minister and the President of the United States last week in Washington does deliver a pipeline of $8.5 billion worth of projects, that's just the start of our Future Made in Australia ambitions for this sector. 

But Australian mining is high tech, provides good jobs, and it's got rigorous environmental standards that are not matched in any country around the world. 

HOST: Okay. And I'll take you – so that covers off the environmental part of that question. What are the protections that are in place for farmland?  

AYRES: Well, just the same as any other mining project. I mean I come from New South Wales where of course the competition between mining developments and farmland is acute, in the Hunter Valley, for example; we've got a legal framework that deals with those questions, an approval framework that deals with those challenges, and you know, as I say, farmland is very important, but there's a framework that will deal with those questions. 

HOST: So, there's nothing additional that's going to come in on the back of this deal that, "Yes, we will be mining for these critical minerals but don't worry because farmland won't be touched". There's nothing like that happening? 

AYRES: No, no, no. 

HOST: Okay. 

AYRES: Just the same approval processes as everything else requires –

HOST: Which might make farmers quite nervous to hear that. 

AYRES: Well, the farming community have been dealing with these challenges in terms of all sorts of development, including residential development on farmland – 

HOST: Yes. 

AYRES:  – around our major cities –

HOST: – they're not happy about it.  

AYRES: Yeah, this is not – well, my experience, farmers on the outside of some of our capital cities have done very well in real estate terms when land's been unlocked for residential use, but you know, that's got to be dealt with in the normal legal framework, just the same as if you're building a shopping centre or a road or a transmission line. 

These critical minerals are crucial to the emerging global industrial economy, whether it's computational capacity, computer chips, communication technology, military hardware, you know, all of the new technologies in energy require these critical minerals, some of them in quite minute quantities. 

I was talking to a major Australian manufacturer today who is concerned about security of supply for their manufacturing processes for quite small amounts of critical minerals that are used in magnet making that are absolutely fundamental to their production processes, and this secures Australia's position in global supply chains, increasing our economic weight, good for our national security and good for good jobs in regional areas. 

HOST: So, these are minerals that are extracted by open pit and underground mining techniques? 

AYRES: Yeah, all of the mining technology that's employed now more broadly in the mining sector, whether it's open cut or underground mining, are sometimes quite simple separation processes, sometimes quite technologically complex processes engaged here. It is a new level of economic complexity for Australia; that is where we lift our productivity, that's how we lift our economic resilience, so that we're not as affected by big global shocks. 

We saw a few years ago when one of our trading partners put impediments in front of our trade, it had a big effect in South Australia in, not least in the wine industry, but more broadly. 

This Albanese Government wants to make sure that we've got economic resilience and sovereign capability in these areas so that we are more resilient in what's a tougher global environment. 

HOST: That is certainly the case. Tim Ayres is the Federal Minister for Industry and Innovation. Concerns are raised on this program all the time from people, let's say they're a representative sample of the Australian population, particularly regionally, about how – and the comments that come through are that we've traded away, for example, our gas, and so that governments have done the wrong thing by the people of Australia in the past, and now we find ourselves with shortages of these assets. 

What kind of money from this deal is going to stay in Australia and bolster Australia, or is it all going to go to foreign owned companies that are involved in the mining of these assets? 

AYRES: I agree with you, absolutely. You know, we've found ourselves in a situation where the gas market's been constructed in a way that means that we are facing challenges in gas, that's why the Government's moved to do a review of our gas market that's been led by Madeleine King, the Resources Minister, and Chris Bowen, the Energy Minister. 

I'm very engaged in that because I'm very focused on making sure that we fix the market so that there is sufficient gas for Australian industry. 

Same issue here, that's why we're focused not just on digging ore out of the ground, which people say in a dismissive kind of way, our mining industry is highly complex, highly technologically advanced, but also that we're processing it onshore in Australia because that's where you capture the value in terms of jobs and in terms of investment. I'll give you an example, lithium. 

HOST: Yep. 

AYRES: We just export lithium ore overseas; we've kept just half a per cent of the overall value chain of lithium. If we manufacture it onshore, we move much higher up the value chain, good jobs, investment here, and also all of the manufacturing that starts to surround that. 

It means that we've got a stake in the battery supply chain, that we're engaged in higher level advanced manufacturing. This is the Australian opportunity here, together with what we're doing more broadly in manufacturing in defence as well, AUKUS submarines. Like this is a big agenda for manufacturing in Australia, and it's really dealing with that challenge that you've raised, how do we capture the value for Australia and Australians. 

HOST: So yeah. What is in the deal, or what is the government's – what is in the government's – critical minerals plan that makes sure that these assets don't go overseas without Australia looking after its own interests and making money out of it, because we are sitting on, as you pointed out, this asset that people want. We now need to use that to build our coffers and not have foreign owned companies take that money. 

AYRES: Well, the first crucial step is making sure that the production happens here. Secondly, where there's foreign investment, that it's dealt with appropriately by a Foreign Investment Review Board, and all of those mechanisms. But we have designed the Future Made in Australia tax credits to make sure that there's an incentive to drive onshore production. 

I don't want to see our rare earths, our critical minerals, our copper exported offshore without it being processed here in Australia. 

I was at Roxby Downs Olympic Dam, you know, the BHP facility, just a few weeks ago, massive copper and uranium processing onshore here in Australia. The government has intervened in Port Pirie to make sure that that lead smelter stays open, and it's manufacturing critical metals for our partners all around the world, not just in the United States, but in European Union and other places. We've intervened in Mount Isa to secure the future of that giant industrial facility there for the same reasons. We are acting in a really determined way that no Australian Government has done in living memory. 

HOST: And that is, with respect, Minister, that is taxpayer money that's going into bolster companies that are based overseas. What sort of royalties are going to come back to the Australian people from critical minerals? 

AYRES: Well, it makes sure that the investment happens here, it secures it here rather than processing happening – 

HOST: Sure.  

AYRES:  – offshore. That's the game here, we're in a race for investment in Australia and Australian jobs. We can either be at the top table and force our way into this discussion, or we can just lean back and let other people manufacture these products offshore and lose the Australian advantage. 

We've stepped in hard, we're being careful with public money, but we are determined to make sure that we capture this advantage for Australia. 

Of course there are opportunities more broadly in the tax system here, in royalties terms, in terms of company tax and all those sorts of revenue opportunities, but it's the jobs that count, good, blue collar jobs in regional communities and in outer suburbs. You know, these mines and these factories aren't built in inner cities or the CBDs of major cities. 

HOST: That is true. 

AYRES: They are built in regional towns –

HOST: Can you tell me what you – 

AYRES: – that's where I come from, that's what I want to deliver for – 

HOST: – expect in royalties from critical minerals over the next five years, 10 years? 

AYRES: I don't have a projection at hand. These projects take time to reach financial close, you know, the Port Pirie facility is operating now. 

HOST: Yep. 

AYRES: But of course, each of these projects operate on different timelines. This is about securing the future so that our kids and our grandkids have got good jobs, have got engineering opportunities, science opportunities, trades opportunities to work in good jobs in Australia in our regions, and that we can make sure that Australia capitalises on these enormous global technological and industrial shifts. 

HOST: Federal Minister for Industry and Innovation, Tim Ayres, thank you, appreciate it. 

AYRES: Thanks Narelle, good to talk to you. 

HOST: Yeah, you too.