Australia is considering the introduction of a price floor for critical minerals, such as rare earth elements, in an effort to attract overseas investment and reduce its reliance on Chinese-dominated supply chains, Bloomberg reported.

Resources Minister Madeleine King revealed the proposal during a press conference in Washington DC, where officials from several nations convened to discuss critical mineral strategies.

The Australian government, through Export Finance Australia, may provide support to underpin minimum prices for these minerals.

The measure aims to help domestic producers remain competitive in a global market where China holds significant processing and refining capabilities.

King said: “We will work to make sure Export Finance Australia has the right financial tools to be able to introduce price floors.”

Australia currently has the fourth-largest reserves of rare earths but lags behind China in downstream processing.

Government plans include the creation of a domestic critical minerals stockpile valued at A$1.2bn ($843m), with initial acquisitions focused on rare-earth elements, antimony and gallium.

This follows a larger US initiative, Project Vault, announced by President Donald Trump, which allocates $12bn to establish a strategic stockpile intended to reduce American dependence on Chinese supplies.

As part of efforts to secure foreign funding, the Australian government has published an online prospectus listing 49 mines and 29 processing facilities available for investment opportunities.

Investment could also take the form of offtake agreements with international partners.

The European Union is expected to propose collaboration with the US on critical minerals this week as countries seek to diversify sources and limit China's leverage in global supply chains.

Shares in Australian-listed critical minerals companies saw an increase on Wednesday (4 February) following these developments.