With electric vehicle production ramping up among major automakers, the US government has increasingly been looking to Canada for the extraction and production of precious minerals.
According to Reuters, the US Department of Commerce recently held a closed-doors meeting with a number of metals miners and battery manufacturers to discuss how to increase Canada’s EV material production. A source who had attended the meeting revealed to Reuters that department officials are looking to swiftly create a Canada/US EV supply chain, as well as increase regional mineral production in order to offset competition from Chinese manufacturers.
The latest talks come amid a growing demand for zero-emission transportation, which is expected to surge over the next ten years. A number of environmental groups have protested against several major mining projects in the US, which in turn has prompted government officials to look to Canada for its supply of minerals. Among the attendees were Tesla Inc, Talon Metals Corp, and Livent Corp, which provided input on ways Washington can aid in the expansion of US companies into Canada.
The event follows last month’s talks between US President Joe Biden and Canadian Prime Minister Justin Trudeau, where both leaders agreed to create a strong EV supply chain between the two neighbouring countries. Since Biden become president, three US mining companies have thus far invested in Canada, where mining contributes to 5% of the country’s GDP, as compared to only 0.9% in the US.
Moreover, lithium-ion batteries, which are used to power electric vehicles, are difficult and dangerous to transport over vast distances, prompting automakers to source them closer to their assembly plants. As a result, Ontario and Quebec are both ideally positioned to build battery cell plants and take advantage of US automakers that are located in Ohio and Michigan.
Information for this briefing was found via Reuters. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.