The US military is looking to fund mining projects in Canada to boost friendly supplies of critical minerals, like lithium and cobalt, per the CBC.
Why it matters: Canada is not a significant producer of most critical minerals, but that could change if the US military tosses a few hundred million dollars into the sector.
- President Biden has allocated more than $1 billion for mining projects to secure American access to minerals needed for high-tech products, like electric vehicles, batteries, smartphones, and advanced military hardware.
- Canadian officials have provided the US with 70 projects that could qualify for some of that sweet, sweet Department of Defense cash.
Why it’s happening: Western governments have grown increasingly nervous about China’s control over the supply of many critical minerals, and the US is ready to spend big to mine more of those precious commodities in allied countries.
- Right now, China is the leading producer of rare earth elements, controls 60% of the world’s lithium processing capacity, and has bought up large stakes in critical mineral mining projects worldwide.
- Last month, the federal government announced restrictions on foreign state-owned companies investing in Canadian critical mineral projects—a move designed to block Chinese businesses from accessing Canada’s resources.
Zoom out: There are already projects in development across Canada to mine everything from copper to chromium to something called niobium (which is used, among other things, to make magnets for MRI scanners). The push by Western governments to build a local critical minerals supply chain should help grow the sector even more.