The coming US election could have far-reaching consequences for Australia’s exporters of minerals critical to the green energy shift, amid predictions of a slowdown in demand for electric cars and renewable power if Donald Trump is returned to the presidency.
New Australian government export forecasts, to be released on Monday, reveal prices for the nation’s vast reserves of sought-after electric battery raw materials, such as lithium and nickel, have begun to recover following steep falls in 2023 and early 2024.
Hummer electric vehicles on the production line at a General Motors factory.Credit: Bloomberg
However, the report from the Department of Industry, Science and Resources cautions that the outcome of the US election between Trump and Joe Biden would impact demand for producers of critical metals.
“The pace of US adoption of electric vehicles and renewable energy technologies... could change depending on the outcome of the US presidential election in November, with significant implications for the demand for Australian critical minerals in the short term,” it says.
Australia has some of biggest known reserves of minerals including copper, cobalt, lithium, nickel and rare earths elements, which the world will need in far greater quantities as raw ingredients to build renewable energy infrastructure, batteries and electric vehicles.
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The US electric car industry has been growing rapidly on the back of the Biden administration’s Inflation Reduction Act, a policy that is providing $360 billion ($538 billion) in tax credits and funding for renewable energy, electric battery manufacturing and electric vehicle production and sales.
However, a victory for Trump in the November election could lead to decarbonisation policies being rolled back and usher in a delayed energy transition, according to global consultancy Wood Mackenzie.
Incentives for electric vehicles would likely be cut, the growth of green hydrogen could falter and power generation from unabated fossil fuels would expand, it said.