A new report by Mandala Partners, commissioned by Boundless, reveals that Australia is uniquely positioned to become a major force in the global green iron export market.
The study suggests that this potential shift could have a more significant impact on reducing global carbon emissions than Australia achieving net zero.
The report projects that by 2050, Australia could supply 20 per cent of the world’s green iron, producing 310 million tonnes annually.
This new industry could generate a staggering $103 billion in annual revenue and create 27,500 direct jobs.
More importantly, green iron production in Australia could reduce global emissions by 1.7 per cent, surpassing Australia’s current emissions, which account for 1.2 per cent of global emissions.
Australia’s potential dominance in the green iron sector stems from several key advantages, including:
- Abundant low-cost solar and wind resources, enabling potentially low-cost green hydrogen production
- Extensive iron ore reserves
- Capacity to co-locate production chain elements for increased efficiency
These factors position Australia to significantly reduce its reliance on China, which currently accounts for 85 per cent of iron ore exports, by opening up new markets in Southeast Asia, Africa, and other emerging economies.
Despite the promising outlook, the report highlights significant challenges.
For example, high capital requirements and technological risks are currently deterring private investment. Therefore, to kickstart the industry, substantial government investment is crucial.
By 2030, the sector would require 16 TWh of renewable energy, scaling up to 775 TWh by 2050 — 2.4 times Australia’s 2030 Renewable Energy Target.
Amit Singh, Managing Partner at Mandala Partners, highlighted the need for government action: “Australia has an undeniable opportunity to position itself as a global titan in a new industry, but that will not happen unless the government pushes hard now to dislodge the boulder from the top of the mountain.
“Relying on private investment alone is not going to get us there, especially given the renewable energy infrastructure requirements.”
Eytan Lenko, CEO of Boundless Earth, underscored the strategic importance of this transition: “This report clearly shows the importance and strategic opportunity of transforming our iron ore industry to a green iron industry — and its critical role in Australia becoming a renewable superpower.
“If Australia reaches its green iron potential, it would be a huge contribution to global climate action — equivalent to exceeding national net zero in Australia.”
As the world increasingly focuses on decarbonisation, Australia stands at a crossroads.
The development of a robust green iron industry could not only secure its economic future but also position the country as a leader in global climate action.
However, realising this potential will require significant investment, policy support, and a concerted effort from both the public and private sectors.
