01/18/2023 | News release | Distributed by Public on 01/18/2023 09:24
Release date: 2023-01-18
What are critical minerals?
Critical minerals are minerals that are essential to modern-day technologies, including renewable electricity, batteries, electronics, and electric vehicles.Footnote1 What is defined as a critical mineral is usually determined by the mineral's strategic importance to a country, as well as the availability of supply, the demand, and the existence of viable substitutes. The list of critical minerals varies by country. Canada's current list, as seen in the infographic below, contains 31 minerals.Footnote2 The list is used to develop policy and prioritize mining-related investments.
Figure 1: Canada's list of 31 critical minerals and their usesFootnote3
Source:Natural Resources Canada
Description: This chart shows the list of 31 minerals that Canada has identified as critical. It also shows some of the applications of these critical minerals.
Future demand for critical minerals
Global demand for critical minerals and the products they are manufactured into is likely to increase significantly in coming decades. The International Energy Agency estimates that, in response to global efforts to reach the climate goals of the Paris Agreement,Footnote4 mineral demand for clean technologies will increase by two to six times by 2040, when compared to 2020.Footnote5
Figure 2 shows how demand may evolve depending on the International Energy Agency's different scenarios. Most growth in demand will be from expanding fleets of electric vehicles and battery storage, as well as expanding electricity networks.Footnote6 Low-emission electricity generation, such as renewables, tend to rely more on critical minerals than other types of power generation.Footnote7
Figure 2: Global minerals demand for clean energy technologies, 2020 compared with 2040 scenariosFootnote8
Source: International Energy Agency - The Role of Critical Minerals in Clean Energy Transitions
Description: This stacked bar chart shows the estimated demand of critical minerals by clean technology (solar, wind, electric vehicles and battery storage, electricity networks, hydrogen, and other low-carbon power generation) in 2020 and in 2040 under three IEA policy scenarios (Stated Policies, Sustainable development, and Net-zero by 2050).
Global mineral production
While all countries require some critical minerals, production (mainly mining and processing) is concentrated more in some countries than in others. For example, in 2020, China produced 57% of global aluminum, while the Democratic Republic of Congo produced 67% of cobalt. Chile produced 28% of copper, Australia 48% of lithium, and Canada 31% of potash.
Figure 3 shows the share (in percentage) of global production of selected critical minerals by country for 2020.
Figure 3: Share of mineral production by mineral and country (2020)
Sources:World Mining Data and World Nuclear Association
Description: This chart shows the share (in percentage) of global production of selected minerals by country, for 2020. The blue columns represent individual countries' share of global production. Canada's share is represented by a red column.
Concentration of mineral production in a few countries makes supply more vulnerable to environmental, economic, and geopolitical risks.Footnote9 This vulnerability, along with rising demand and limited production capacity for these critical minerals, has caused recent and significant price increases. For example, the price of lithium increased by 738% between January 2021 and March 2022, while cobalt increased by 156% and aluminum by 76%.Footnote10
Canada seeks to assert itself as the leading mining nation. The recently released Canada's Critical Minerals StrategyFootnote11 illustrates how Canada intends to responsibly increase critical minerals production and support the development of domestic and global value chains.
Canada already produces over 60 minerals and metals and is a top five global producer of 14 mineral and metal products:Footnote12