The US election result could hurt green metals exports from Australia

The upcoming US election could have far-reaching implications for Australian exporters of minerals key to the green energy transition, given predictions of a slowdown in demand for electric cars and renewable energy if Donald Trump returns to the presidency.

The Australian government’s new export forecast, due to be released on Monday, reveals that prices for the country’s vast reserves of sought-after raw materials for electric batteries, such as lithium and nickel, have started to rise after sharp declines in 2023 and early 2024.

However, a report from the Department of Industry, Science and Resources warns that the outcome of the US election between Trump and Joe Biden will impact demand for critical metals producers.

“The pace of adoption of electric vehicles and renewable energy technologies in the US… could change depending on the outcome of the US presidential election in November, which will have significant implications for demand for Australian critical minerals in the near term,” the report said.

Australia has some of the world’s largest known mineral deposits, including copper, cobalt, lithium, nickel and rare earth elements, which the world will need in much greater quantities as raw materials to build renewable energy infrastructure, batteries and electric vehicles.

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The U.S. electric vehicle industry is growing rapidly thanks to the Biden administration’s Inflation Reduction Act, which provides $US360 billion ($538 billion) in tax breaks and funding for renewable energy, electric battery production and the production and sale of electric vehicles.

However, a Trump victory in the November election could lead to a rollback of decarbonization policies and delay the energy transition, according to global advisory firm Wood Mackenzie.

It said incentives to purchase electric vehicles would likely be reduced, the development of green hydrogen could slow and energy production from limitless fossil fuels would increase.