Canada’s critical mineral advantage

As published on Substack

It’s not often the leader of a large Canadian company visits Ottawa. Which is why it was so important for policymakers to hear Teck CEO Jonathan Price’s remarks on Thursday morning.

His message was clear: the actions Canada takes to develop its critical minerals over the next five years will set the trajectory for the next fifty. If Canada can get this right, it will create an unrivaled advantage for its economy, improving the livelihoods of all Canadians.

Price’s Ottawa address came just one day after Canada’s Minister of Foreign Affairs Anita Anand travelled to Washington to participate in an international meeting on critical minerals. One hopes Anand and United States Secretary of State Marco Rubio will reinvigorate critical mineral trade between both countries and build on the Joint Action Plan signed under President Trump’s first term.

As geopolitical threats and the weaponization of commodities become more common, Canada’s critical minerals have nationally significant value. They can help Canada exert its sovereignty while forging new economic alliances and helping resolve global challenges like energy security and climate change.

Much has been written recently about why resilient and well-coordinated critical mineral supply chains are needed to keep pace with the rapid scale of electrification, digitization and global transformation.

But global value chains – often relying on similar materials like copper, aluminum and rare earth minerals – remain disjointed and are too inefficient to produce supplies at the scale the world demands. Mineral deposits are geographically dispersed while processing and refining capacity remains concentrated in hubs controlled by foreign states that pose a national and economic security risk to Canada and its allies.

Canada has many of the critical minerals essential for its defence, energy and advanced manufacturing sectors. But financing, permitting and ultimately securing that mineral supply is a challenge. National ambitions will fall short if coordination between governments and the private sector doesn’t improve.

Thankfully, governments are coming together at an unprecedented speed to expedite major project approvals through equivalency agreements (for example, in Ontario and Manitoba) and create new partnerships such as a shared critical minerals strategy for western Canada. This is welcome news. Canada has some of the longest lead times in the world for mining projects and production for many mineral commodities is down by double digits, despite record levels of investment by federal and provincial governments.

At the federal level, critical minerals are central to the government’s plans to attract capital to Canada. The Major Projects Office is designed in part to instill investor confidence by improving the timeliness and predictability of major project approvals and permitting. At the same time, Budget 2025 incents higher levels of investment through expanded tax credits for mineral exploration and technology and adds roughly $3.5 B in new funding.

However, coordination with trading partners remains in flux. This isn’t to say that Canada is falling short in its pursuit of new trading opportunities. In fact, late last year the federal government announced 26 new investments with nine allied countries totalling $6.4 billion in critical mineral projects in Canada to bolster global supply chains. These investments demonstrate that Canada is willing to intervene directly in strategic mineral markets, signalling a fundamental shift from traditional laissez-faire commodity policies toward security-driven industrial planning. Since then, important commitments have been secured with India and Saudi Arabia to promote critical mineral trade and investment.

But recent tension between Canada and the United States threatens to erode the business case for investment in North America. Successive trade agreements and the Canada-U.S. Joint Action Plan on Critical Minerals built a strong basis for critical minerals trade. Canada remains the biggest source of imports to the U.S. for aluminum, nickel, steel, copper and niobium. However, a recent study by TD Economics found that questions about the continuation of economic integration between Canada and the U.S. have negatively impacted foreign direct investment in both countries.

Mr. Price reminded today’s audience “public policy matters”. Sage advice as Canada navigates an ever-changing landscape.

The forthcoming review of the United States-Mexico-Canada Agreement provides an opportunity to stabilize our relationship with our largest trading partner. At the same time the government’s efforts to grow trade outside of North America could finally bear fruit. Critical minerals can be key to Canada’s success.