https://www.canadianminingjournal.com/
Low prices dampen investment for development
Natural Resources Canada barely got its invite out the door to the critical minerals industry in January when more bad news hit. Plummeting prices for metals such as lithium and nickel pushed the ministry’s pitch for help updating the criteria of Canada’s list of 31 critical minerals list to the back burner. Instead, some in the industry were demanding government intervention, up to and including the feds spending taxpayer money on new critical minerals projects.
How bad was the hit to lithium and nickel prices? Enough for companies to capitulate and begin shutting down capacity and production, said Canada Nickel Company CEO Mark Selby (and former head of commodities research). This occurred most recently on Feb. 12 when Glencore announced it was transitioning its Koniambo Nickel operation in New Caledonia into care and maintenance.
“When you get to the bottom of a price cycle generally what you see is a bunch of producers throw in the towel,” said Selby. “They say ‘Prices are going to stay low; they have been too low for too long; they are going to keep staying low. I must shut down and stop burning cash.’”
Now imagine how enthusiastic lenders are likely to be about your plan to build a new mine, especially in Canada where development dollars have mostly disappeared. It normally takes at least a decade to build a new mine and at enormous cost, mostly borne historically by retail investors.
For the rest of this article: https://www.canadianminingjournal.com/featured-article/an-invite-to-revise-critical-minerals-list/