Raw Materials in Australia 2025: Trends, Policies & Opportunities

Australia’s wealth has long been tied to its vast reserves of raw materials—iron ore, coal, lithium, copper, rare earths, and more. In 2025, the sector is at a crossroads: global supply chains are recalibrating, clean energy ambitions are accelerating, and government policy is shifting to encourage sustainable growth. For investors, business owners, and everyday Australians, understanding the evolving landscape of raw materials is crucial to making informed financial decisions.

Why Raw Materials Matter More Than Ever

Raw materials are the lifeblood of Australia’s export economy. According to the Department of Industry, Science and Resources, resources and energy exports are projected to reach a record $460 billion in 2024–25, with iron ore, LNG, and lithium leading the charge. But it’s not just about traditional mining—critical minerals are now in the spotlight, driven by global demand for batteries, electronics, and renewable energy infrastructure.

• Iron ore remains our biggest export earner, but prices are volatile as China’s steel industry slows and alternative suppliers emerge.
• Lithium and rare earths are seeing explosive growth, thanks to the world’s appetite for electric vehicles and clean tech.
• Coal is in structural decline, but high energy prices and Asian demand still keep it relevant—for now.

This changing mix is reshaping the jobs market, state budgets, and Australia’s geopolitical clout. The question for 2025 and beyond: how do we maintain our competitive edge while supporting the global shift to decarbonisation?

2025 Policy Updates: Incentives, Sustainability, and Security

Federal and state governments are rapidly adapting their policies to ensure Australia remains a global resource powerhouse. Key 2025 initiatives include:

• Critical Minerals Strategy Update: The Australian Government’s 2025 Critical Minerals Strategy has expanded support for processing and refining, aiming to capture more value onshore and reduce reliance on unstable global supply chains.
• Investment Incentives: New tax credits and grants are available for projects that boost domestic processing, with a special focus on battery materials and green hydrogen feedstocks.
• ESG and Reporting: Stricter environmental, social, and governance (ESG) standards now require miners to demonstrate sustainability credentials. This has sparked rapid adoption of greener mining tech and more transparent reporting.
• Trade Policy: Australia is deepening ties with Japan, South Korea, and the EU to diversify export markets, reducing the overdependence on China.

These policy shifts are designed to attract global capital, foster regional development, and ensure long-term security of supply for critical industries worldwide.

Opportunities and Risks: What’s Next for Investors and Businesses?

The raw materials sector in 2025 is brimming with both promise and pitfalls. For investors and operators, some key themes stand out:

• Value-Add is King: Companies that move up the value chain—from raw extraction to processing and manufacturing—are seeing higher margins and resilience against commodity price swings.
• Decarbonisation Drives Demand: The global push for net-zero emissions is turbocharging demand for lithium, nickel, copper, and rare earths. Australian firms with strong ESG credentials are well placed to attract investment from sustainability-focused funds.
• Technology and Automation: Automation, AI, and real-time data analytics are being rapidly adopted to boost productivity and reduce environmental impact. Early adopters are outpacing the competition in cost and compliance.
• Community and Indigenous Partnerships: Engaging with Traditional Owners and local communities is now essential. Projects with strong social license are less likely to face costly delays or reputational risk.

But there are risks to watch: geopolitical tensions, regulatory uncertainty, and global price volatility can all impact project viability and returns. Diversification and agility are key for navigating the years ahead.

Case Study: The Rise of Australian Lithium

No story captures the 2025 raw materials boom quite like lithium. With global EV sales expected to top 20 million units this year, Australian lithium miners are expanding rapidly. Companies like Pilbara Minerals and Liontown Resources are ramping up production and investing in downstream processing, aiming to become not just exporters of ore, but suppliers of battery-grade chemicals. The new government incentives and private investment are turning WA into a world-class battery materials hub, illustrating how policy, technology, and global trends are converging to create new opportunities.

Looking Ahead: Australia’s Next Moves

As the world transitions to a cleaner, more connected economy, Australia’s raw materials sector will continue to evolve. Success will hinge on innovation, responsible stewardship, and the ability to adapt to changing global dynamics. Whether you’re an investor, entrepreneur, or policymaker, staying informed and proactive will be key to thriving in this era of resource transformation.