Germany focusing on Canada’s mineral wealth by Ian Ross (Northern Ontario Business – January 11, 2013)

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business

Canada is increasingly being looked upon by Germany as a source of supply for strategic raw materials. The 500-member Canadian German Chamber of Industry and Commerce is promoting Canada as a stable and viable place to invest, establish a presence and form strategic partnerships.

With Canada acknowledged as a global mining hub and a friendly producer of metals, the chamber is pushing for more business relationships between the two countries as mineral resources are taking a new priority in the European country.

“The German companies are realizing that Canada has a lot of potential and it’s politically stable,” said Aarti Soerensen, the chamber’s manager of mining and mineral resources. “It’s not a complicated country.”

Germany is one of the world’s largest consumers of raw materials and its companies are increasingly looking for secure sources of resources to feed its high-tech manufacturing and processing sector.

Spurred by global events with China’s increasing grip in accessing strategic resources and the race for Africa’s mineral wealth, Germany’s federal ministry of economics and technology launched a new raw materials strategy in 2010.

Germany has traditionally sourced its raw materials from China, Africa and South America.

In sizing up the volatility of commodity prices and general global uncertainty, the German government wants to diversify its sources of raw material supply.

“It really showed that Germany was in a difficult position over the last 20 years,” said Soerensen. “We don’t have significant companies in the metals sector.”

Many companies are engaged in aggregate material, but not so much in strategic metals like tungsten, tantalum, germanium, zinc, copper, molybdenum used in specialty glass, metal alloys and the renewable energy sector.

“We have a number of processing companies with refineries that do value-added processing, and we have a huge sector of high-end manufacturing that depends on the imports of those metals,” said Soerensen

“But we depend 100 per cent on imports for all these metals that we don’t have the ownership (stake) in the sources.”

Thanks to the Canadian German chamber, Canada is now one of the identified target markets.

“We believe that Canada has been underestimated and undervalued,” said Soerensen. “It’s an ideal partnership with Canada being a net exporter of a lot of these minerals. Germany has equipment in the mining sector that could be very beneficial to supply this booming industry.”

With great examples of German success stories already operating in Canada, namely Siemens and Festo, Soerensen said there are cross-cultural values that offer a great fit toward better co-operation.

In seeking to promote closer ties on the mineral front, the chamber has established a Competence Centre for Mining and Mineral Resources.

In November, the chamber hosted a German business delegation and conference in Toronto that included one-on-one matchmaking meetings with potential Canadian partners.

Soerensen said there was a broad mix of visiting companies engaged in mineral exploration and contracting, software development, steel trading, supplying conveyors and ore-handling equipment, as well as one fully integrated mining company seeking off-take agreements and to make a long-term investment in a project development.

Most of the one-on-ones took place in Toronto, but one company did travel to Sudbury to meet with Wallbridge Mining officials.

She expects some German companies will return for next spring’s Prospectors and Developers Association of Canada (PDAC) show in Toronto when the chamber intends to have an expanded presence.

“I think there will be around 25 companies here at PDAC.”

Soerensen said if there’s sufficient interest from Canadian mining-related companies and organizations, she wouldn’t rule out a return trade mission to Germany in the near future.