The boss of the world’s biggest mining company said it was “understandable” that nations were scrambling to secure domestic supply of the metals needed in renewable energy and electric vehicles, but warned against an excessively domestic focus and over-reliance on the “sugar hit” of state-provided subsidies.

“Governments striving to secure their own critical mineral supplies must ensure they don’t undermine the outcome the world needs to achieve – where in fact a combination of pragmatic international cooperation and competition can jointly accelerate the energy transition,” Henry said a conference in Brisbane on Tuesday.

Henry’s warning comes as global competition for minerals such as lithium, nickel, cobalt and rare earths continues to heat up as nations and industry rush to meet ambitious emissions reduction goals. China controls a large chunk of the supply chains of these minerals, which has worried the US, Europe and other economies.

The US Inflation Reduction Act, legislated last year, set aside almost US$400 billion to subsidise clean energy, and the US has set up partnerships with allies, including key miner Australia, to build critical mineral supply chains that exclude China.

While Henry didn’t explicitly criticise these efforts in his speech, he said any moves to mimic the new law in a smaller country like Australia would be “a losing proposition”.

“What governments here – federal and state – should focus on are those things within their control to make investment fundamentally more attractive,” he said.

Meanwhile, Henry also urged the Chinese government to provide more support for the struggling housing market, which is a major driver of steel demand, acknowledging recent economic data from the nation was “a little patchy”.

“We do think there’s room for a little bit more policy that is supportive of housing and housing new starts,” he told reporters after the speech. Still, he remained optimistic about the outlook for steel and iron ore demand, saying: “Our expectation remains that the second half will be stronger than the first.”