Australia Mandates Divestment of Chinese Stake in Rare Earths Miner Northern Minerals

Australia’s Treasurer Jim Chalmers has mandated six China-linked shareholders to divest their combined 17.58% stake in Northern Minerals Ltd, a rare earths miner crucial for global supply chains. This directive, issued on national interest grounds, covers approximately 1.68 billion shares and has a divestment deadline set for July 2, 2026.

The decision follows the failure of three of the six entities to comply, leading to the freezing of their voting and shareholder rights. This intervention marks the third instance in three years where the Australian government has acted to limit Chinese influence over Northern Minerals, which operates the Browns Range project in Western Australia, known for producing dysprosium and terbium—elements essential for electric vehicles and defense systems.

The entities affected include Hong Kong Ying Tak Limited and Real International Resources Limited. Previous attempts to block these shareholders from increasing their stakes were made in 2023, and legal challenges arose following the first divestment orders issued in 2024.

The freezing of voting rights creates a complex situation for the shareholders, who retain ownership without the ability to influence company decisions. This move reflects Australia’s commitment to reducing reliance on Chinese rare earths, especially as global demand for these materials continues to rise.

China currently dominates the rare earths market, controlling about 70% of global mining and over 90% of processing capacity. The Australian government’s actions are part of a broader strategy to secure critical mineral supply chains, particularly in light of recent Chinese export restrictions.