By Jeffrey A. Newman Esq.
Today, the Chinese government announced that it was escalating controls of exports of rare earth metals to the United States. Also starting Nov. 8 it is restricting all kinds of equipnment needed to manufacture batteries for electric cars. The new rules are expected to have a negative effect on major companies including Nvidia and Apple. Rare earths are essential for computer chips and magnets that power electric motors in drones and wind turbines. China mines and processes the majority of the worlds rare earths.
However, there is a unique and compelling opportunity for the United States to mine, process and gain nearly immediate access to all of the rare earth minerals at issue. That opportunity resides with Canada which needs mining and processing but has the world’s third greatest supply of the rare earth minerals within its borders. The U.S. does have companies that mine and process these minerals. Canada is home to several more critical minerals and metals than just those listed above. According to Natural Resources Canada, the following are included on the government’s list of 31 critical minerals and metals, over two-thirds of which are already being produced somewhere in the country :
- Aluminum
- Antimony
- Bismuth
- Cesium
- Chromium
- Cobalt
- Copper
- Fluorspar
- Gallium
- Germanium
- Graphite
- Helium
- Indium
- Lithium
- Magnesium
- Manganese
- Molybdenum
- Nickel
- Niobium
- Platinum Group Metals
- Potash
- Rare Earth Elements
- Scandium
- Tantalum
- Tellerium
- Tin
- Titanium
- Tungsten
- Uraniam
- Vanadium
- Zinc
Canada, although home to more than 15.1 million tonnes of rare earth oxide in 2022, is currently not a significant producer of REEs, a group of 17 chemically similar metallic elements on the periodic table.
Canada also has reserves of lithium, graphite, nickel, cobalt, copper, and rare earth elements. The Canadian government has identified 31 critical minerals and metals essential for developing “future” economies domestically and internationally, 21 of which are already produced in Canada and with significant opportunities for further resource development. Canada has the world’s sixth-largest lithium reserves and was the eighth-largest producer in 2022. Canada was the ninth-largest graphite producer and was home to the ninth-largest reserves in 2021. Graphite is strong and flexible but not elastic, has high electrical and thermal conductivity, and is highly refractory and chemically inert.Its unique properties make it ideal for manufacturing lithium-ion batteries, fuel cells, and nuclear reactors. Graphite is one of five materials needed for electric vehicle batteries and storage batteries for wind and solar power applications.
Canada was the sixth-largest nickel producer and home to the seventh-largest reserves in 2021. Today, the critical metal is produced in Quebec, Ontario, and Newfoundland and Labrador, which accounted for 41.5%, 36.4% and 22.1% of Canada’s production in 2021, respectively . Nickel is used to manufacture stainless steel, accounting for over two-thirds of total consumption. It is also used in geothermal power, hydrogen systems, and advanced battery storage. Cobalt is another critical mineral found in Canada, the seventh-largest producer and home to the seventh-largest global reserves in 2022.
Canada was the eleventh-largest copper producer in the world in 2021, and is home to approximately 1% of global reserves – well behind Chile (23%), Australia (11%), Peru (9%), Russia (7%) and other top ten reserve holders. Almost all Canadian copper production is found in British Columbia and Ontario, accounting for 57.4% and 23.8%, respectively, with Newfoundland and Labrador, Manitoba and other provinces and territories accounting for a smaller share. Copper is one of the few metals that has anti-bacterial properties, making it suitable for medical applications. It is also used in in electrical applications like electric vehicles, wind turbines, and solar panels.
What Canada needs are U.S. companies that will joint venture in mining and processing and those companies, knowing the immediate demand would likely advance quickly if the US administration would incentivize such a deal (which might mean mending some fences over tariffs). But both nations would benefit so much from this arrangement at a critical time in the world economy. Canada could also help supply our growing need for electricity, as it produces a surplus of electricity from its dams. I wrote about this previously in another blog but this too would greatly benefit both nations. These are deals waiting to happen!
Jeffrey Newman is a whistleblower lawyer and his lawfirm represents whistleblowers reporting violations of export controls, tariff evasion, healthcare cases and other kinds of WB cases. We represent individuals both in the United States and from other countries. Mr. Newman and his firm also represent physician whistleblowers nationside in healthcare fraud cases. Whistleblower laws in the U.S. allow individuals anywhere, with information about export control violations or tariff fraud to reveal the information as a whistleblower under The False Claims act or through the Securities and Exchange Commission’s Whistleblower Program. If you have such information, contactg the Newman firm. The Firm’s website is www.JeffNewmanLaw.com . Attorney Newman can be reached at Jeff@Jeffnewmanlaw.com or at 617.823.3217
