Australian Treasurer Jim Chalmers has directed six China-linked shareholders to divest their stakes in rare-earth miner Northern Minerals due to concerns about Chinese entities attempting to gain control of the company. This action is aimed at safeguarding Australia’s national interests and ensuring compliance with foreign investment regulations. The move is part of Australia’s efforts to prevent control bids on Northern Minerals, which is working on the Browns Range heavy rare-earths project in Western Australia, aligning with Western nations’ strategies to reduce China’s dominance in this sector.
Chalmers emphasized the implementation of a robust and non-discriminatory foreign investment framework, stating that further measures will be taken if necessary to safeguard national interests in this matter. This decision follows previous interventions in 2024, where five Chinese entities were mandated to sell their shares on national-interest grounds. Australia also prohibited Hong Kong-based investor Ying Tak from voting and selling its shares after investigations revealed Tak’s acquisition of stakes from a Chinese party compelled to divest in 2024.
Northern Minerals has indicated that it is evaluating its next steps following the directive from the Australian Treasurer. Subsequently, the company’s shares experienced an over 8% decline to 0.022 Australian dollars, trading at less than half of its issuance price in a placement conducted last October. China’s foreign ministry has urged Australia to respect the rights and interests of Chinese investors while advocating for a transparent and non-discriminatory business environment for foreign investments.
According to a report by the Australian Institute of International Affairs, China currently dominates approximately 90% of rare earth separation and processing, along with 93% of magnet manufacturing. This near monopoly has enabled China to utilize rare-earth exports as a strategic tool, as evidenced by past instances such as restrictions imposed during maritime disputes with Japan in 2010 and January 2026, as well as recent export controls employed in negotiations with the United States.
