Prime Minister Anthony Albanese is continuing his six-day official visit to China, where Australia’s $120 billion iron ore trade is front and centre — but concerns over defence obligations to the US are never far from the surface.
Day two of the visit sees Albanese shifting focus to iron ore, Australia’s most lucrative export, of which China is by far the largest buyer. According to UN data, Australia exported over $120 billion worth of iron ore to China in 2024, accounting for 61% of China’s imports, according to the Australian Strategic Policy Institute.
However, China’s increasing push toward emissions reduction could challenge that trade, given Australia’s high-energy ore refinement processes. Albanese is joined in talks with Chinese industry leaders by major figures like Andrew “Twiggy” Forrest to explore ways Australia could help “greenify” China’s steel production.
On the diplomatic front, national security issues continue to swirl. Reports suggest the US may seek a more explicit Australian military commitment under a revised AUKUS framework, particularly regarding any future Taiwan conflict.
National security analyst Michael Shoebridge warned that Albanese is “walking a tightrope”, saying:
“Australia’s defence strategy hinges on never fighting alone. We prevent war with partnerships, but fight together if needed.”
Despite resisting pressure for increased defence spending, Albanese presides over large-scale joint military exercises involving 30,000 troops from the US, Japan, South Korea, and other allies currently underway in Australia.
Later this week, Albanese is expected to meet Chinese President Xi Jinping — a delicate diplomatic moment that will test Australia’s ability to maintain a strong economic partnership with China while upholding strategic alignment with the US.
