Canada hopes to beat China in the race for rare earth metals

Canada is pitching itself as an option for the several European nations seeking to reduce their reliance on China for crucial raw materials, which are required for the production of goods such as electric vehicles.

The G-7 member announced a strategy to increase production of these minerals in December, with Canada possessing the greatest resources. It is believed that Canada has around 15,1 million tons of rare earth oxide.

The European Union and other regions of the world are attempting to reduce their reliance on China while intensifying their efforts to create a more sustainable economy. European officials are concerned that China may use its strong position in raw commodities in a manner similar to how Russia began weaponizing gas against the alliance.

Mary Ng, Canada’s minister of international trade, told CNBC on Tuesday, “We’ve learned that the resilience of supply chains is crucial, and that the manner in which minerals are mined is also crucial.”

According to government data, it might take between five and twenty-five years for a mining project to become operational, thus the Canadian government is attempting to expedite the licensing process for new facilities.

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Some nations are increasingly acknowledging that minerals and other basic commodities are now a subject of national security. This is already a reality in the European Union, with Russia’s invasion of Ukraine revealing the bloc’s dependence on a single massive source.

Head of the European Commission Ursula von der Leyen stated in Canada earlier this month, “We observe now, for example, that China generates 98% of Europe’s rare earths. And Europe must reduce this dependency’s risk.”

When asked if Canada was eager to dethrone China as the primary provider of essential materials for the planned green shift in the West, Ng responded, “If I look at a recent data, Canada is currently ranked second in the battery ecosystem sector.”

“Thus, it’s second only to China,” she remarked, adding that Ottawa was fifth in similar rankings “not too long ago.”

“Canada desires to contribute to the solution. We are already partnering in the development of hydrogen and essential minerals, and we are also collaborating in the building of a robust supply chain across the Atlantic,” she continued.