Reindustrialisation policies in the West have yet to boost domestic production, while China and other Asian economies continue to strengthen their position, according to British-Australian mining giant Rio Tinto.

The US and the EU are trying to incentivise local industry through policies such as the US Inflation Reduction Act (IRA) and the EU’s Green Deal Industrial Plan. However, they have not led to “a significant increase in output” so far, Rio Tinto ceo Jakob Stausholm tells the LME Week seminar attended by Kallanish in London.

He says the industry needs to support governments to create “the right regulatory environment” to ensure capacity can be scaled up quickly. Noting that lengthy permitting processes account for 40% of the delays in critical minerals projects globally, Stausholm calls for closer cooperation between policymakers and industry to accelerate the energy transition.

Jonathan Price, ceo of Canadian miner Teck Resources, tells the conference that most government funds have been directed to battery and car manufacturing, rather than upstream towards the mines.

“While we’ve got things like investment tax credits, which can be quite helpful, I think there are other tools that the government can use,” he says, adding that manufacturing without raw materials is a “pipedream.” 

In China, however, players benefit from replication at scale, delivery at speed, and a tight supply chain, making it an “outlier” in a world that is not electrifying fast enough, Stausholm says.

The industry also needs to work to improve circularity, Stausholm argues, as there is plenty of scrap coming online but many countries lack the means to process it. “It’s clear the recycling industry needs to turn a corner,” he says. “This can only be achieved through supportive government policies.”

For the Rio Tinto chief, the closure of aluminium smelters is an example of how western policies have failed to achieve their goals.