In the midst of growing geopolitical tensions, critical minerals are quickly becoming a prized asset for Canada. But a new study suggests the country may not be able to meet future demand, raising questions about its role in the global supply chain. The report, published by the Climate Institute of Canada, paints a grim picture of Canada’s mining future, forecasting a sharp decline in mineral production over the next 15 years.
A Staggering Decline in Mineral Production
Canada’s output of critical minerals—vital for clean energy technologies like electric vehicles and solar panels—is expected to fall drastically. In 2023, the country’s production was valued at $9.2 billion. By 2040, it could plummet by more than half, down to just $4 billion, a decrease of 56.5%. Meanwhile, demand for these minerals will continue to rise sharply, with projections suggesting a domestic need of $16 billion, four times the anticipated output.
Marisa Beck, the Climate Institute’s director of research in growth, emphasized the contrast: “The demand will increase over the next 15 years, while the local production will decrease,” she said, underscoring the risks to Canada’s economic stability in the face of growing international pressure.
The Growing Global Demand for Critical Minerals
The global demand for critical minerals is on a steep incline, driven by the rapid shift to clean energy. The Bloomberg New Energy Finance group predicts the demand could increase by 2,100% between 2022 and 2050, depending on the type of mineral and the ecological targets set by governments worldwide. Canada, with its vast reserves of lithium, nickel, cobalt, copper, and graphite, is in a prime position to capitalize on this global boom. But despite these resources, the country currently exploits only a small portion of them.
Canada’s reserves could help fuel the clean energy transition globally, yet the country is not moving fast enough to take advantage of the opportunity. “We don’t use our critical mineral resources enough,” Beck remarked, stressing the untapped potential beneath the Canadian soil.
The Path Forward: Investment and New Mines
To avoid being left behind, the report calls for significant investment in the sector. It estimates that Canada needs to invest $30 billion into its mining sector by 2040 just to meet domestic demand. An additional $65 billion is needed to serve international markets, with the establishment of at least 30 new mines across the country. Without these investments, Canada risks losing its competitive edge in the rapidly expanding global market for clean energy materials.
Beck also pointed out that Canada must tackle several barriers slowing the mining sector, including regulatory delays and opposition from local communities. “The mining sector is global, and the capital to develop projects is likely to come from international sources,” she noted, urging a more aggressive approach to attracting foreign investment.
The Role of Indigenous Communities in Mining Development
Another challenge highlighted by the study is the need for stronger collaboration with Indigenous communities. The report advocates for a model of free, prior, and informed consent, emphasizing that such agreements could reduce conflicts and speed up project development. “The participation and consent from Indigenous communities make these processes smoother,” said Beck.
According to Ian London, president of the Canadian Critical Minerals and Materials Alliance, governments should prioritize the efficiency of these projects. He suggested that while it’s crucial to push forward with critical mineral production, governments should be prepared for opposition from some communities. “If they say no, don’t keep pushing,” London advised, adding that not every project may be viable for development.
