Beneath the Australian desert sands lies another Broken Hill, Mt Isa, perhaps even another Kalgoorlie – several vast, world-class mineral deposits capable of generating centuries’ worth of national prosperity.

How can I be sure? Well, we’ve really only searched a third of this continent thoroughly so far, and look what we’ve already found. Logic, as well as geology, suggests that there’s twice as much wealth still hidden under the sand and rubble that masks two thirds of our landmass. And more wealth still, the deeper we go.

Yet just when we ought to be looking our hardest and smartest, to offset the effects of the global downturn and build a platform for the next, inevitable, surge in world mineral demand, Australia is cutting back.

Companies are laying off the geologists, mining engineers and metallurgists they couldn’t hire enough of a year ago. Some university mining and geology schools are in deep trouble and may even close.  The national research investment we make to remain leaders in the global mining and minerals business is minuscule when compared with the $159 billion return it will generate this year, and it is shrinking.

Our existing resources are becoming costlier to extract. We’ve run through most of the high grade, easy-to-reach ores. We’re now onto the tough ones, where you have to dig deeper, crush more rock for less product, or use more energy, water and money to win the metal from a tricky ore.

Mining in Australia is becoming harder and more expensive at the precise moment in history when it needs to be more efficient, cleaner – and smarter. Some mining companies don’t see a problem: they can shift to South America, Africa or a place where the ores are richer and easier to find, labour cheaper, water plentiful and in some cases, the rules more lax.

It is a problem for Australians. We’re the ones who will miss out on the future wealth that minerals can bring this country. In my career I’ve seen two huge mining industries, in Britain and the United States, dwindle and (in the case of the UK) die because they didn’t invest enough in the technology and skills to remain competitive. Don’t think it can’t happen here.

We haven’t discovered a major, world-class orebody in this country since the early 1970s, and the ones we found back then are starting to run out. If we don’t find new ones soon then the blunt fact is that Australia’s minerals sector will start to shrink, the nation’s trade balance will tip into the red, lots of jobs and skills will head offshore, and governments will have fewer funds to invest in on national development.

After the longest period of sustained mineral prosperity in our history we’re repeating the mistake of draining the lifeblood of our industry – discovery and innovation – at the very time we ought to build it up, to ride out the hard times and get ready for the good ones when they come again. It’s getting to be a habit: in the latest boom we lost five years in terms of technology and infrastructure, and it cost us almost $20 billion in global market share.

Australia isn’t so rich we can afford to hand $20 billion to our competitors every time there is a cyclical upturn in the markets, not to mention all the jobs and skills. The time to invest in the technologies that give us a leading edge is now, today – not when it is too late.

For example, CSIRO is developing a powerful suite of technologies to ‘see’ into and through the regolith – the rubble that shrouds two thirds of our continent – to predict and discover huge new ore systems, just below the surface or even a kilometre or more down. This will be vital as present quality ores are used up.

We’re inventing novel ways to mine ore and intelligent machines that can sense their way through the orebody to extract the richest deposits. We’re pioneering ‘keyhole mining’, the automation needed to exploit and process ores underground, leaving a minimal footprint at the surface.

We’re devising cheaper, cleaner and smarter ways to extract minerals, or process difficult ores, mineral sands and bauxite. Australia has hundreds of billions of dollars in known mineral deposits that cannot currently be exploited economically without these new processes. This is wealth for the taking, but first we need the science to take it.

CSIRO is developing some spectacular technologies which will enhance the production of aluminium and titanium and other products, reduce their environmental impact, recycle wastes into valuable products and fabricate ultra-strong, lightweight materials for the eco-cars, boats, buildings, aircraft and manufactures that are in such growing demand. We are shaping the “industrial ecology” of the future, systems where “wastes” are recycled through various industries, to create new wealth instead of a disposal headache.

This endowment of resources and leading-edge technologies offers Australia an opportunity like no other to end the busts of the traditional minerals cycle, create hundreds of thousands of value-adding and high-tech jobs along with new industries and exports. First we have to invest in the knowledge that delivers them, both publicly and privately. If we wait for the next boom to do so, it will be too late.

The horse that wins the Melbourne Cup is never starved by its owners. Indeed, they usually breed from it.  Yet Australia is now starving its greatest industry winner of the past 150 years. It wouldn’t make a lot of sense to a horse owner, and it doesn’t make much sense for a nation. We can end the minerals boom/bust cycle by applying our brains, and planning now for the next great phase of minerals demand.

Peter Lilly is director of CSIRO’s Minerals Down Under National research Flagship.