JO TRILLING: Critical minerals, I'm talking lithium, nickel, cobalt, are expected to be the bedrock of future industry. They currently contribute over $100 billion to our GDP. Now, you may recall late last year, the government doubled the size of a federal investment fund to kickstart critical minerals and rare earth projects and encourage American miners and processors into Australia. Well, now major local players are winding up mines. Today, the third WA nickel mine in as many weeks announced it's set to close. And this has all prompted emergency talks between industry and the government. Heading up these talks is Federal Resources Minister Madeleine King . Welcome to Drive, Minister.

MINISTER MADELEINE KING: Hi, Jo. It's good to be here.

JO TRILLING: Why are you so concerned that you are holding these talks?

MINISTER MADELEINE KING: Well, the thing about nickel and lithium and other critical minerals is, and particularly the critical minerals and nickel is actually on the strategic materials list, is the fact that their markets can change quickly and fluctuate quickly. And we've seen this with lithium certainly in the past, and also with nickel for that matter. And so I'm having - these talks are what we'd ordinarily do when there's a matter of concern. I'm very open that I like to consult with industry and experts about seeing what they think government can do best to help them when we're in a context where there's not going to be hundreds of millions of dollars of subsidies into this industry because our Federal Budget simply can't sustain that. But there are things the government can do, and there have been some suggestions, and I'm bringing these groups together to have a bit more of a deeper dive into how they think government can best help them. And I'm doing that as well with the Western Australian Minister for Mines, David Michael, as well. So, look forward to these talks later this week.

JO TRILLING: As I understand it, what's going on in the nickel sector is largely the result of Indonesian production and their products. Why are you stepping into this market?

MINISTER MADELEINE KING: Well, I'm not stepping into this market. We've produced nickel for a long time in Western Australia and across the country, but in particular, WA. I mean, the nickel refinery in my electorate is older than I am. So, you know, we've had a market for this. The Kambalda refinery as well, has been existence for some time. It's just the use and popularity of nickel has changed. It used to be used for stainless steel, but now it goes into batteries. But what we saw a little a few years back is Indonesia put a ban on export of unrefined nickel, which then led to an extraordinary amount of international investment into their nickel refineries. So, it's a different competition than it was six or seven years ago. And that makes it difficult sometimes for Australian businesses to compete when we do have much higher standards than many of the other nickel producers in the world. So, that's how we can work together to get to a good position for that nickel industry is what I want to talk to industry about.

JO TRILLING: So, is Indonesia now beating us in the race? I mean, I think they're producing more than half the global supply, up from only about a fifth of global output a decade ago.

MINISTER MADELEINE KING: Yeah, I can understand why Indonesia would want to do that. They want to create an industry and jobs for their own people. And that makes a lot of sense. I don't support banning exports of nickel as they did. It was a means to ensure international investment came into the country to produce those massive refineries. So, it's not the best way to build an industry, but nonetheless, it's within Indonesia's right to do so. We are in a different market.

JO TRILLING: Yeah, and if there is such fluctuation in the market, what realistically can government do?

MINISTER MADELEINE KING: Well, what we know is that Australia produces nickel well, and when I say well, you know, we have good governance, we have good environmental processes, we have good consultation with the traditional owners of land. We have high work standards and very high safety standards. People are well paid in the industry and that's not necessarily the case with our competitors. We are a high cost country, but that's a good thing because it means that our people are getting paid well so that they have a high standard of living. You've got to compete with lower cost producing countries. So, what some of the suggestions have been is around how do you account for that high ethical standard of nickel production in the price of nickel and the pricing of nickel. Now, that's an international markets question and it's really something I'm trying to grapple with. But this is what federal governments are here to do, is to lead international discussions on how you can make sure there is a premium on ethically sourced and ethically produced high standard nickel sulphide. And that's one of the things we'll be talking about later this week.

JO TRILLING: Madeleine King is the Minister for Resources. She has called an urgent meeting with industry over the state of the critical minerals industry. Minister, reports today suggesting that Andrew Forrest's Wyloo Metals will place its Kambalda nickel mines in care and maintenance by May 31, and that could lead to significant job losses. Will you be meeting with unions as well as industry to better understand the problem?

MINISTER MADELEINE KING: Undoubtedly, we'll meet with unions as we get more details on what some of the companies are proposing around either their closures or curtailments or just going into maintenance. But we'll happily meet, and we'll meet in the ordinary course of business with all those affected, because it is a difficult time when industry does have these closures, and I understand why they do have them, because pricing can't be sustained. And nickel has had these fluctuations seemingly in this cycle of about eight years on, eight years off, sort of. So, it is difficult. You can't always predict it, but it is a cyclical industry. Fortunately, in Western Australia, there are lots of opportunities for people, but I do accept that they're not necessarily in the place where people live. And it can be a very challenging time for the workers.

JO TRILLING: How concerned are you about job losses?

MINISTER MADELEINE KING: I'm very concerned, absolutely. Whenever there's a shutdown or a curtailment or decline in production, and it will affect jobs and the jobs people like and are accustomed to and would rather stay in for their security. So, whenever this kind of thing happens, I'm deeply worried about the workers and of course, their families and the wider communities in which they live, because there's certainly knock on effects.

JO TRILLING: Minister, what impact do you think this could have on the energy transition as we transition to renewables?

MINISTER MADELEINE KING: Well, it could have an enormous effect, to be honest, because we need nickel. But at the moment there is an oversupply and this is what we see reflected in the prices. And that's why production is slowing down in Australia, because there's just not enough buyers or not people willing to pay the higher prices. And I think there is a discussion to be had on how some of the advanced the vehicle manufacturers need to perhaps step up and be willing to pay more for ethically sourced nickel to make sure that people can be confident when they buy these vehicles that they are getting a vehicle that has - its contents are made with good, high ethical standards. So, there's enough nickel, at the moment, that means the batteries will be keeping produced. But you've got to ask yourself the question, what's in those batteries and who's paid the price for them?

JO TRILLING: Minister, just finally, I'm going to be talking cost of living after 5 o'clock. You're being called back two weeks early for a caucus meeting on Wednesday. There has been speculation that the stage three tax cuts could be scaled back. Is this true?

MINISTER MADELEINE KING: Yeah. Well, I haven't been called back early at all. I'm here for cabinet and there's a number of people already here for just getting back to work in Canberra for their departments and committees. So, it's certainly not an extraordinary call in the least. But we maintain our election commitments and we'll be going ahead with the stage three tax cuts.

JO TRILLING: So, you wouldn't support a scale back?

MINISTER MADELEINE KING: Well, it's an election commitment, and we should go ahead with what we committed to the Australian people.

JO TRILLING: Minister, thanks for your time.

MINISTER MADELEINE KING: Thanks. Thanks, Jo. All the best.