A free-trade agreement between Australia and the European Union would encourage closer ties on critical minerals at a crucial time for the energy transition, Europe’s Commissioner for Energy Kadri Simson said during a visit to Australia.

Talks between the two sides on a trade pact collapsed last year with Canberra unhappy over access to EU markets for its farm goods. They are also seeking cooperation on critical materials — like lithium, copper and nickel — as Western nations push back against Chinese dominance of supply chains.

Simson said an FTA agreement would be a “strong enabler” for joint work on supply of key raw materials, adding to pressure on Australia for a return to negotiations.

“Just as the EU is keen to secure supply chains through investments in critical minerals mining and prospecting, the Australian industry is calling out for more investment,” Simson told an audience at the National Press Club in Canberra on Monday. “But as long as our trade continues to be discriminated against, the opposite will happen.” 

Australia is the biggest global lithium producer, but barely sends any energy-transition metals to Europe. In Australia’s last fiscal year ended June 2023, the nation sent 98% of its lithium spodumene to China, according to government figures.

Simson said she had been in conversations with Australia’s Resources Minister Madeleine King for an agreement on critical minerals, and that there would be more news “soon.”

But she added that the EU wanted to resume discussions on a free trade agreement as well. “I’ve been consistently telling my Australian counterparts that we want to re-engage, get back to the negotiating table,” she said.

Australia has maintained any negotiations for a free trade pact are unlikely to resume until after the European Union elections in 2024.