Canada’s battery supply reliability soars as billions announcements continue

Federal Innovation Minister François-Philippe Champagne is once again touting Canada’s battery supply chain prowess in Asia this week, but this time with a new boast in his back pocket.

Research firm Bloomberg NEF has boosted Canada’s position in its annual global ranking of battery producers, ahead of any other country except China.

“We will use this heavily on our trips to Asia to say that we have what Asia needs,” Champagne said.

The study ranks 30 countries with a significant presence in industries ranging from mining raw materials to manufacturing batteries and their components.

In the first version of 2020, Canada was ranked 4th, and in 2021, after lower mining production and higher regulatory hurdles, Canada ranked 5th.

But Canada has announced more than $15 billion in investments over the past 10 months, from mining and processing vital minerals, to manufacturing battery components, producing electric vehicles and building the nation’s first gigafactory.

This allowed Canada to overtake Sweden, Germany and the United States, even as they invested heavily under the Inflation Reduction Act.

“I think this is a home run for Canada in the sense that they had a vision to actually build an ecosystem from mining to recycling,” Champagne said.

His trips to Japan and South Korea this week are in that vein, with a planned stop in Germany next week. Having met several times, he says his focus is on strengthening those relationships and continuing Canada’s claim to being a presence in the field.

The battery supply chain has many links, starting with the mining of raw materials such as lithium, nickel, aluminum and copper used to make batteries. These minerals and metals are refined so that they can be used to make the building blocks of battery cells: cathodes, anodes and electrolytes.

Then combine these components to create a battery cell. This is similar to alkaline non-rechargeable batteries that most consumers are familiar with. The Gigafactory then packages many of these cells together to create battery packs that power everything from laptops and cell phones to electric cars. .

The Bloomberg NEF report looks at demand for all these supply chain components, as well as end products and environmental stewardship.

Canada gets top marks for keeping its supply chains green, thanks to its abundant supply of renewable energy and environmental regulations around mining. The BloombergNEF study also assesses Canada’s efforts to boost mining activity.

Canada still lags behind in battery cell and component manufacturing and domestic demand for electric vehicles, but last year saw a number of announcements improving both.

One of Canada’s biggest selling points is access to the raw materials needed to make batteries, said Ontario’s Minister of Economic Development, Vic Fedeli, when he traveled to Germany last month to meet with industry officials. Afterwards, he told the Canadian Press.

“They talk about our important minerals, and that is because there are a very limited number of important mineral producers operating outside of China, so we don’t have a genuine interest in them. “We have a really engaging audience,” he said.

Canada is not the largest producer of the key metals and minerals needed for batteries, but it is one of the few places in the world that can produce them all.

Canada and its allies are also trying to prevent China from using its dominance in the battery supply chain industry to influence global politics. They likened it to Europe being too dependent on Russia for gas.

Having started investing in the sector over a decade ago, China now holds three quarters of all battery cell manufacturing capacity and 90% of anode and electrolyte production.

Its raw mineral production is not always the highest, but it has invested heavily in mines in other countries, including Canada, and brought their products to China for refinement and use in manufacturing. China produced about 4% of the world’s nickel last year, but refined more than two-thirds of it, according to the US Geological Survey.

About 14% of the lithium produced in 2021 has been mined, but 59% has been refined.

Canada has begun taking steps to limit China’s influence within its domestic supply chains. Earlier this month, Champagne said Canada would limit foreign state-owned companies’ involvement in the vital minerals sector, and a week later ordered three Chinese companies to sell their stakes in small Canadian companies.

But there are many others, including Canada’s only lithium mine currently in operation. Manitoba’s Tanco Mine is owned by China-based Sinomine Resources Group.

Champagne didn’t say what other orders were coming, but hinted at additional announcements.

“I will look at these deals like a hawk to ensure that the national and economic security of Canadians is protected,” he said.