Budget measures to boost critical minerals

When the budget was handed down two days ago, one particular line item caught our attention.

The 2022-23 Federal Budget has allocated $250M for critical minerals with $200M over five years for the Critical Minerals Accelerator Initiative (CMAI) and $50.5 million over three years for a virtual National Critical Minerals Research and Development Centre (NCMRDC).

This is on top of a previous $294M already allocated to critical minerals, part of a larger $2B initiative launched last year.

Some of these funds have already arrived in the coffers of Hastings Technology Metals in the form of a $140 loan facility, a neighbour of our rare earths investment, Frontier Resources (ASX:FNT).

The upshot of all of this for us as investors is that Australia is making a concerted effort to secure future supply of critical minerals - minerals needed for the energy transition (renewables like wind power), EVs and defence applications.

In past weekend additions and recent notes we’ve emphasised how this is an emerging theme in both the US and Australia.

We also highlighted in our latest FNT note that: “A U.S. F-35 fighter jet needs 427 kg of rare earths while a Virginia-class nuclear submarine uses nearly 4.2 tonnes of rare earths.

These are the very same fighter jets and submarines that Australia is procuring or may procure from the United States.”

That’s just rare earths, and here’s a list of the other critical minerals as per Geoscience Australia:

For a more in depth read, there’s also valuable information in the Australian Critical Minerals Prospectus.

We have a broad range of exposure to critical minerals which is why we want to point out a new feature on our website - portfolio filters.

On the homepage there’s this button on the right:

Clicking that button will make a drop down menu appear where you can select for certain types of companies.

In this case, if you are searching for critical minerals stocks you could search for the Energy Transition Portfolio, Nickel, Rare Earths, or Lithium, for example.

Check it out.