For eight decades the US dollar has underpinned the global economic order, sustained not only by America’s financial system but by its military reach and its unmatched industrial base. That dominance is now facing a formidable challenge. The BRICS alliance (Brazil, Russia, India, China and South Africa) is no longer content to talk about alternatives to the dollar. It is building them, brick by brick, through commodity exchanges, alternative financial systems, and a resource-backed trading order that plays to its overwhelming advantage in natural wealth.
A Resource-Backed Challenge to the West
The latest move by BRICS to create a Precious Metals and Rare Earth Exchange is a direct strike at the foundations of Western economic primacy. This platform would allow trade to be settled not in the fiat currencies of London or New York but in tangible commodities such as gold, platinum, cobalt, nickel, and rare earth elements. These resources are not abstractions. They are the irreplaceable inputs for everything from semiconductors and electric vehicles to artillery shells, hypersonic missiles, and nuclear propulsion systems.
The numbers underscore the imbalance. BRICS nations control more than 70 percent of the world’s rare earth reserves and dominate their processing. They produce the overwhelming majority of niobium, cobalt and nickel, metals critical for advanced weapons and clean energy technologies. They hold vast oil reserves, a third of global grain, and more than 12,500 tons of gold. In a world already turning away from dollar dependence, this control of hard assets has the potential to displace the financial leverage Washington has wielded for generations.
Implications for the US Military-Industrial Complex
The military-industrial complex in the United States is entirely dependent on a secure and affordable flow of these minerals. Lockheed Martin’s F-35, Raytheon’s precision-guided munitions, Boeing’s aircraft, and General Dynamics’ naval platforms all rely on rare earth magnets and high-performance alloys. Hypersonic weapons, which Washington views as central to the next era of deterrence, require niobium to withstand extreme thermal conditions. Yet Brazil, a founding BRICS member, produces nearly all of the world’s niobium.
The irony is unavoidable. The arsenal that sustains US military power is built on materials controlled by states that are actively building financial structures designed to curtail American influence. If BRICS proceeds with its resource-backed exchange, the Pentagon’s supply chains will be as vulnerable as the dollar it once used to secure global primacy.
Where This Leaves Australia
For Australia, a nation already locked into the AUKUS security pact and facing its largest peacetime rearmament in history, the stakes are profound. Canberra’s strategic bet is that the US alliance will guarantee security in the Indo-Pacific. Yet AUKUS also ties Australia’s future military capabilities to US supply chains that may be undercut by BRICS’ resource dominance. If Washington cannot secure the rare earths and critical minerals needed to produce nuclear submarines, advanced missiles, and integrated combat systems, then AUKUS risks becoming an expensive promise that cannot be delivered.
At the same time, Australia itself is one of the world’s richest sources of rare earths, lithium, and critical minerals. Its reserves are already sought after by both Washington and Beijing. The question is whether Canberra will channel these resources exclusively into sustaining US-led military supply chains, or whether it will acknowledge the new multipolar reality in which BRICS sets the rules of trade.
The BRICS Alternative and Australia’s Dilemma
The proposed BRICS exchange is not just an economic experiment. It is a geopolitical tool designed to erode the capacity of the West to use sanctions, financial exclusion, and control of benchmarks as levers of power. For states in Africa, Asia, and Latin America, the appeal is obvious: a system based on real assets, less vulnerable to political interference, and less dominated by legacy institutions such as SWIFT or the London Metal Exchange.
Australia now finds itself pulled in two directions. As a loyal US ally, it has committed billions to defence integration through AUKUS, tethering itself to American strategy. Yet as a resource-rich state, it stands to benefit materially from rising demand for the very minerals BRICS seeks to revalue. If Canberra binds itself too tightly to Washington, it risks forfeiting the opportunity to play a central role in a new trading system that reflects the economic weight of the Global South. If it flirts with BRICS, it risks undermining the alliance upon which its defence strategy depends.
A Strategic Crossroads
The world is undergoing a profound shift. The dollar’s decline is not a hypothetical scenario but a measurable trend, accelerated by sanctions, by the freezing of Russian reserves, and by the willingness of major oil exporters to transact in yuan. The US military-industrial complex, once able to assume access to critical resources, is discovering that material reality is catching up with financial privilege.
For Australia, this is no longer an abstract debate. Its strategic minerals are at the heart of the contest. Its defence budget is tethered to US supply chains. Its economy is enmeshed with China, a BRICS leader. The question is whether Canberra can reconcile these contradictions, or whether it will wake to discover that its alliance commitments and its resource endowments are pulling it in opposite directions.
The answer will determine not only the viability of AUKUS but Australia’s position in a world where power is measured not in promises, but in control of the metals, minerals, and resources that modern warfare and modern economies cannot do without.
Australia’s minerals in the new resource geopolitics
Resource power is shifting from balance sheets to the periodic table. To see where Australia really stands in a BRICS-shaped world, the numbers matter.
Lithium. Australia supplied about 36 percent of global lithium mine output in 2024, the single largest national share, anchoring allied battery and defence supply chains that run through the United States and Europe. By contrast, China dominates midstream processing of critical minerals, including lithium conversion, and retains overwhelming grip on rare earth refining and magnet manufacturing.
Rare earth elements. Australia holds about 4 percent of global rare earth reserves and is scaling output, but China controls the processing chokepoints and related technology by a very wide margin, with multiple analyses putting Chinese control of processed REEs and magnets near or above 90 percent. That processing leverage is already being weaponised through export controls.
Nickel. Australia sits on roughly 18 percent of the world’s nickel reserves based on USGS tallies, a strategic position for both energy transition and high-temperature defence alloys. However, Indonesia leads global nickel mine output and refining, a reminder that BRICS partners and BRICS-aligned producers in the Global South shape availability and price.
Cobalt. Australia’s mine production was about 2 percent of world output in 2023, while the Democratic Republic of Congo accounted for about 74 percent of global mined cobalt. Much of that material is refined in China. The geography undercuts any simple West versus BRICS framing, yet it reinforces the broader point that processing power sits in Asia and supply risk is high.
Niobium. The strategic alloying element essential for hypersonics and high-temperature systems is over 90 percent controlled by Brazil for mine production, with Brazil also holding the overwhelming majority of known reserves. That is raw, BRICS-core leverage.
Gold. Australia is a top-three gold producer, contributing about 10 percent of global mine output in 2024. With prices at records, Canberra’s gold exports are forecast to become the nation’s second-largest resource earner after iron ore in 2025–26, which boosts fiscal resilience in any currency-reshaping world that BRICS or others may build.
[Key sources for the figures above include the IEA’s Global Critical Minerals Outlook, USGS Mineral Commodity Summaries, CSIRO briefings on rare earths, the World Gold Council and recent reporting on Chinese export controls and Australia’s export outlook]
What these shares mean for AUKUS and the US alliance
For the United States, the military-industrial base still turns on access to niobium, REE magnets, high-nickel alloys and battery-grade lithium and cobalt. BRICS members and close partners dominate the ore bodies and, crucially, the processing. For Australia, the combination of large lithium output, meaningful nickel reserves, credible rare earth potential and top-tier gold production places Canberra in a pivotal seat. It can either remain a reliable upstream producer that feeds allied value chains tied to AUKUS, or it can hedge into a more plural trading architecture where a BRICS-anchored exchange sets terms on settlement and pricing for metals that underpin next-generation weapons and energy systems.
If Beijing continues to tighten REE export controls and if Brazil channels niobium through BRICS-aligned pricing, AUKUS programs that depend on hypersonic materials, high-temperature steels, power-dense electric drives and advanced sensors will face cost and schedule risk. Australia’s own ore can offset part of that risk, but not all of it. The chokepoints are at the refinery and magnet plants, and right now they are mostly in China. Building allied midstream capacity is not optional. It is the price of strategic autonomy in an era where commodities are clearinghouses for power.
In short, Australia’s percentages buy influence. They do not buy insulation. The AUKUS bet only pays if Canberra leverages its position to accelerate allied processing capacity, secures long-term offtakes on fair terms, and treats critical minerals like munitions rather than like bulk commodities. Otherwise, a BRICS-backed metals exchange can change the rules of trade faster than submarines and missile lines can be stood up.
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