“We can’t wait:” Heavy investment needed to secure green metal future

Australia needs to show the world it’s committed to pursuing green iron and steel production in order to secure its export future, a finance expert has warned, following talks with metal producers in China. 

Australian Sustainable Finance Institute standards executive manager Nicole Yazbek-Martin issued the advice after attending a workshop with Australian and Chinese regulators and companies in Beijing. 

The warning comes after a host of funding announcements for green metals by the federal government, but also after mining firms scrapped several green hydrogen project proposals that could have helped establish the industry. 

Green iron, which is made using renewable energy resources such as green hydrogen, solar and wind power, has the potential to cut 90 per cent of emissions from the steelmaking process.

The low-emission option has great potential as an export earner for Australia, Ms Yazbek-Martin said, particularly in the Asia Pacific region with existing trading partners. 

“China is very committed to the reduction of steel-making in their economy because they are the world’s (biggest) producer of steel and it’s contributing significantly to their emissions,” she said. 

“Not only does closer co-operation help reduce (emissions in) their steel sector if we’re able to get this trade right, but it also guarantees future off-take for Australia’s commodities.”

Australia is the world’s biggest exporter of iron ore, earning $116 billion from the mineral in the 2024 financial year, although revenue is expected to drop as nations move to sustainable options. 

Partnering with countries including China to share sustainability standards and policies for adopting green metals, could shore up future export opportunities, Ms Yazbek-Martin said. 

Further investments in green iron and steel would also be needed to show Australia was serious about the industry, in addition to reforms to the Safeguard Mechanism for reducing industrial emissions and quicker approvals for renewable energy projects. 

“There is no reason why we can’t make this happen and certainly the desire and will do so is there,” she said. 

“We can’t wait until the optimal system is in place to get started, we’ve just got to do everything, everywhere all at once and keep pushing.”

A report by The Superpower Institute, issued earlier this year, found Australia could triple its iron ore export revenue to $386 billion by 2060 by shifting to green iron.

The federal government also launched a $1 billion Green Iron Investment Fund to support the industry, with $500 million set aside for early investments in the technology. 

Applications for grants under the program close in January. 

Mining firm Fortescue is expected to be the first company to produce green iron in Australia after executive chairman Andrew Forrest confirmed its Christmas Creek project in Western Australia would begin production later in 2025. 

Source: AAP