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Mining billionaire Gina Rinehart builds rare-earth stakes in push for non-Chinese supply

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The Australian mining billionaire Gina Rinehart has built a nearly 6 per cent stake in rare-earth developer Lynas, strengthening her hand in the contest to build a non-Chinese supply of critical minerals.

In the span of a week, Rinehart’s Hancock Prospecting has bought shares in Australia’s Lynas and taken a 5 per cent holding in US-listed MP Materials. The companies are the two largest non-Chinese rare-earth developers and recently held merger talks.

They ended negotiations in February after failing to strike a deal, but Rinehart’s emergence on the share registers of both companies has fuelled speculation that she could be positioning herself to play kingmaker in any future talks.

Her moves come against the backdrop of a strategic push by the US and Australia to build critical minerals supply and refining capacity to reduce dependence on China, which accounts for about 60 per cent of the world’s rare-earth mining and close to 90 per cent of processing and refining, according to the International Energy Agency.

Rare earths are a set of 17 elements used in a variety of products critical to the energy transition, including wind turbines and electric vehicles. A decline in prices has put pressure on Lynas shares over the past year. The emergence of Rinehart as a shareholder sent the stock up more than 5 per cent on Wednesday.

Andy Forster, senior investment officer at Argo, which also owns Lynas stock, said Rinehart looked to be positioning herself to get a “seat at the table” in rare earths at a time of pricing pressure and weak share prices of key players. “It has been a tough space of late, but the long-term story is pretty sound from a demand perspective. The challenge is that China still dominates,” he said.

The strategic significance of Australia’s critical minerals strategy has come into focus as lithium and nickel prices have also suffered a sharp decline.

Caroline Kennedy, US ambassador to Australia, told a mining conference in Perth on Wednesday that there were national security and economic implications, with the country’s battery minerals sector, including nickel, coming “under assault” from Chinese state-owned operators in Indonesia.

Rinehart already holds a 10 per cent stake in Arafura Rare Earths, a project in Australia’s Northern Territory that the government backed last month with A$840mn (US$540mn) of loans and grants.

Rinehart, dubbed the “iron lady” in Australia, built her fortune in iron ore but drew attention last year when she built stakes in two lithium prospects — Liontown Resources and Azure Minerals.

This disrupted plans by foreign companies to acquire the companies, and she is now seen as a significant force in the development of lithium, a key material for electric vehicles, in Australia.

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