New York-listed miner Tronox Holdings PLC (NYSE:TROX) is considering an investment in a rare earths processing facility in Western Australia (WA), potentially contributing to Australia's efforts to break China’s dominance in the global supply of rare earths rare earth elements (REEs).

Tronox, which mines mineral sands including titanium and zircon in NSW and WA, has informed Australian regulators of its intention to retrofit and expand its local operations.

This move aligns with the growing demand for rare earth elements in countries like the United States, Japan, South Korea, and Australia.

The strategic importance of rare earth elements, including terbium, dysprosium, neodymium, and praseodymium, has heightened due to their critical role in decarbonisation and defence applications. Companies like Tronox and Iluka Resources Ltd (ASX:ILU) have an advantage in pivoting to rare earths production, as they currently expel these metals as waste in their primary mineral sand operations.

Aiming to lessen China's dominance

Iluka is currently constructing a rare earths refinery in WA, financed partly by a A$1.25 billion loan from the federal government's Export Finance Australia. This development aims to lessen China's dominance in the rare earths market. Meanwhile, Australian miner Lynas Rare Earths Ltd (ASX:LYC, OTC:LYSCF) is advancing a cracking and leaching plant in Kalgoorlie, resembling the initial stage of its Malaysian processing plant.

The plans by Tronox and others in the sector come amidst the Foreign Investment Review Board's scrutiny over Chinese investments in Australian critical minerals, highlighting the strategic and geopolitical importance of this sector. Lynas is set to hold its annual general meeting in Sydney, which will likely include discussions on these industry developments.