The Association of Mining and Exploration Companies (AMEC) has unveiled an industry-driven strategic framework to support and expand rare earth production in Australia as part of efforts to shore up global critical minerals supply chains, addressing vulnerabilities exposed by concentrated international markets.

The proposal, developed in consultation with rare earth producers and prepared for the federal government’s Critical Minerals Strategic Reserve initiative, emphasises production support mechanisms designed to reduce investment risk and deepen Australia’s role as a reliable supplier to allied nations.

AMEC’s blueprint centres on a Rare Earths Production Scheme (REPS), a production underwriting model that uses contract-for-difference agreements with price floors and ceilings to provide revenue certainty for rare earth projects during market volatility while capping fiscal exposure for taxpayers.

The model mirrors capacity investment mechanisms used in other strategic sectors and aims to attract private capital to both heavy and light rare earth projects, ensuring stable output of critical elements needed for permanent magnets in defence, clean energy, advanced manufacturing and technology applications.

The framework builds on the Albanese government’s broader Critical Minerals Strategic Reserve, to which Australia has allocated A$1.2 billion and which prioritises antimony, gallium and rare earth elements in its initial focus to strengthen supply chains and mitigate reliance on concentrated foreign sources.

Industry engagement, including ongoing consultations between AMEC, government stakeholders and ten rare earth developers, is expected to refine the delivery, governance and eligibility settings as legislation enabling the reserve advances through Parliament.

AMEC chief executive Warren Pearce has stressed the importance of responsive policy design to underpin a commercially viable and strategically sound approach, noting that the REPS would help underpin confidence for investors and producers alike.

The association contends that the production support model will enable Australia to capitalise on its abundant mineral endowment, bolster its contribution to allied supply networks and support broader national security and economic objectives.

As the policy moves toward implementation, AMEC and industry partners are poised to work with government to ensure the reserve’s mechanisms effectively enhance rare earth production capacity, supply chain resilience and international market participation.