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There is a shift happening in global trade and this reshaping is presenting Canada with a pivotal opportunity to enhance its role in the global supply chain of rare earth minerals. While geopolitical tensions and trade policies influence market dynamics, Canada’s vast mineral resources and sustainable development, position it as a key player in meeting the world’s growing and changing needs.
As the United States sharpens its trade stance with new tariffs on raw materials and battery components from countries like China, the ripple effects extend far beyond American borders, and Canada stands to benefit. For the Canadian mining sector, the U.S. push to secure critical minerals domestically isn’t just geopolitics at play—there is a new and glaring need to secure supply, presenting a rare opportunity for Canada to rethink how we mine, process, and profit from the resources beneath our feet.
Traditionally, much of Canada’s mining industry has focused on raw extraction, with minerals then shipped overseas for refining. But with global supply chains under pressure and tariff walls going up, that model may no longer serve our long-term interests. As competing suppliers face growing trade barriers and export restrictions, Canada can fill the void.
The global trade in energy-related critical minerals has experienced exponential growth, increasing from $53 billion to $378 billion over the past two decades. This growth is driven by the escalating demand for electric vehicles (EVs), renewable energy technologies, and advanced electronics. Notably, the battery sector alone accounts for 70% of the global demand for cobalt, alongside significant needs for lithium, nickel, and rare earth elements.
But here is the problem, China currently dominates the refining and processing of several critical minerals:
This concentration of processing capabilities has led to vulnerabilities in the supply chain, as evidenced by recent export restrictions imposed by China on rare earth elements in response to U.S tarriff’s. These metals are critical for U.S manufacturing. As competing suppliers face growing trade barriers and export restrictions, Canada has an opportunity to do more than drill and blast. We can and should refine, process, and add value to the minerals critical to clean energy and tech-driven industries.
Canada possesses abundant reserves of critical minerals and is among the top five global producers of ten such minerals, including nickel, cobalt, and lithium. In 2023, Canada exported $29.8 billion worth of critical minerals, with significant trade partners including the United States, China, Brazil, and Norway. Despite this, Canada’s export profile remains heavily weighted towards raw and semi-processed minerals, with limited capacity for high-value refining and manufacturing. For instance, in 2023, Canada exported $1.6 billion in copper and $904 million in potash to China, but the majority of these exports were in early stages of processing.
The demand is clearly there. The U.S. imported $2.39 billion worth of raw nickel in 2023 alone, making it the world’s largest importer. Of that, Canada supplied nearly half, at $1.15 billion, followed by Norway and Australia. This underscores just how central Canadian exports already are — and how much more value we could capture by supplying refined, battery-grade nickel and other critical materials rather than raw forms.
Beyond nickel, the U.S. imported 3,400 metric tons of lithium for consumption in 2023, marking the highest import volume in recent years. This surge highlights the escalating demand for lithium, a key component in electric vehicle (EV) batteries and renewable energy storage systems. Canada, with its vast lithium reserves, stands poised to meet this demand through domestic processing and refining initiatives.
In the realm of cobalt, the U.S. imported over 1.7 million kilograms of cobalt and its derivatives in 2023, valued at approximately $91.4 million. Canada was a significant supplier, providing 29,771 kilograms of this essential mineral. Cobalt is crucial for the production of high-performance batteries used in EVs and electronic devices, and Canada’s role in this supply chain is increasingly vital.
Additionally, the U.S. imported rare-earth metals, including scandium and yttrium, totaling over $22 million in 2023 with a significant portion of these imports coming from China, underscoring the need for diversified and secure supply sources. Canada’s potential to supply these materials, coupled with its commitment to sustainable and ethical mining practices, positions it as a strategic partner for the U.S. in reducing reliance on single-source imports. It also gives Canada leverage in trade negotiations and can be used to mitigate the use of tarriffs.
To capitalize on the growing global demand and reduce dependence on foreign processing, Canada has the opportunity to invest in domestic refining and manufacturing capabilities. By moving up the value chain, Canada can produce high-purity metals and advanced materials essential for EV batteries, renewable energy systems, and electronic devices.
This strategic shift would not only enhance Canada’s position in the global market but also create high-value employment opportunities in mining, metallurgy, chemical engineering, and clean-tech manufacturing. Such investments would align with global trends towards electrification and sustainability, supporting Canada’s own automotive industry and contributing to economic resilience.
The clean energy supply chain represents one of the most immediate and strategic opportunities Canada has seen in decades. As global supply chains shift, manufacturers around the world are looking for reliable sources of critical materials, and Canada is perfectly positioned capitalize. Automakers and battery manufacturers are already scouting sites for new facilities in Ontario and Quebec, where access to both raw materials and clean hydroelectric power creates a distinct advantage. However, to build economic resilience and insulate Canadian industries from commodity price swings, Canada needs to build!
In order to fully integrate a complete domestic supply chain, Canada needs to build, and build fast. Without domestic refineries to produce high-purity metals or the infrastructure to transport them efficiently, we risk missing this opportunity. Mining needs the modern equivalent of pipelines in roads, rail, and processing hubs that connect resource-rich regions to ports, manufacturers, and global markets. Investment in mining and processing could spark growth in Northern Ontario, British Columbia, Quebec, and the Territories where untapped mineral deposits go unrealized due to bureaucracy.
Canada can also leverage this opportunity to build meaningful partnerships with Indigenous communities, many of whom hold the land rights and have a deep interest in how development occurs. With the right frameworks, these partnerships can drive projects that are not only economically viable but also environmentally responsible and socially inclusive.
At the end of the day, think both the federal and provincial levels of government have started to recognize and acknowledge the need to accelerate projects, but more is needed beyond the small investments in infrastructure, strategic funds, and clean-tech incentives. From the Critical Minerals Strategy to tax credits for value-added processing and manufacturing, the support is starting to show, but now is the time to scale. The window won’t stay open forever. Geopolitical shifts and global trade dynamics are redrawing the map of critical mineral supply chains. Countries are re-evaluating alliances, supply routes, and industrial strategies.
In this climate, Canada has a unique opportunity to evolve from a traditional resource exporter to a high-value, clean-tech powerhouse. If we seize the moment with bold investments and coordinated action, we can create well-paying jobs, drive innovation in rural and remote regions, and reinforce our role as a trusted supplier of critical minerals in a rapidly changing world.
Canada has the resources. The world has the need, and the message is clear. We can’t just mine it… We need to refine it.
https://natural-resources.canada.ca/maps-tools-publications/publications/mineral-trade
