Canada’s mining sector valued at $97 billion by new report
The Mining Association of Canada (MAC) released its annual Facts & Figures 2019 report and noted that while the prospects for Canadian investment and the attractiveness for new mine investment are brighter, certain competitiveness metrics remain depressed. It also warned that there signs that the country could lose hold of its leadership position in the sector, potentially jeopardizing the country’s ability to seize new opportunities for growth.
Canada ranks among the top five countries in the global production of 15 minerals and metals. The industry was valued at $105 billion in 2018, and mineral exports accounted for 19 percent of Canada’s total domestic exports, the report found.
Facts & Figures reports that in 2018, Canada’s mining industry contributed C$97 billion or 5 percent to Canada’s total nominal gross domestic product (GDP).
The report looks at the entire mining sector in Canada and found some concerning results. Among those are the modest increase in the value of mining projects that are planned and under construction from 2010 to 2019. The report found that number increased by $8 billion year-on-year, with the total 10-year projected value of $80 billion, but that remains 50 percent below the 2014 level of $160 billion.
Direct investment abroad from 2007 to 2018 has tripled — from $25.5 billion to $80 billion — but that mining foreign direct investment into Canada remained stagnant, rising from $23.5 billion to $24.5 billion.
Creamer Media’s Mining Weekly reviewed the report and noted that only five new mining projects were submitted for federal environmental assessment review in 2018, which is “well below” the average levels seen from 2012 to 2014.
MAC also points out that Australia’s mining supply sector surpassed Canada’s in 2015, leading now by more than 700 firms. Over the last 15 years, several Canadian senior mining companies have been acquired by multinationals.
Canada’s production of critical minerals and metals has also been eroding since 2016 as the country has dropped from second to sixth in the global production of nickel, with output falling 38 percent from 256 to 160 kt (282,000 to 176,000 st).
However, MAC CEO Pierre Gratton said in a media statement accompanying the Facts & Figures 2019 report that the industry was energized by a number of commitments pertaining to mining, including Prime Minister Justin Trudeau's most recent mandate letters to his Cabinet, the Canadian Minerals and Metals Plan and the new Canada-U.S. Joint Action Plan on Critical Minerals Collaboration.
“If we seize these opportunities effectively, a new era may well be upon us, one we haven't seen in many years,” he stated.
In 2018, capital spending in the Canadian mining industry is projected to account for 5.1 percent of Canada’s total at $12.9 billion — up 5 percent year-on-year. The increase breaks a five-year downward trend in capital investment in the Canadian mining sector, which peaked in 2012 at $19.5 billion before falling 43 percent over the ensuing years.
Canada’s share of global nonferrous exploration investment also increased from 13.7 to 15 percent in 2018, although it was still well below the peak of 20.8 percent in 2008.
The industry association pointed out that the mining industry contributed $97 billion, or 5 percent, to the nation’s total nominal GDP in 2018. One in every 30 jobs in Canada is related to the mining industry, with more than 620,000 people directly and indirectly employed.
Photo: McEwan Mining’s Black Fox Mine.