Snapshot: Tariffs in Perspective
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PERSPECTIVES No.9 | February 4, 2025
CANADA’S CRITICAL MINERALS INDUSTRY CATCHES ITS BREATH—FOR NOW
Well, that was a close one.
It seems that, at least for the next 30 days, Canada, Mexico and the United States have hit pause on what was shaping up to be a trade war that would have been difficult to end. President Trump’s planned tariffs have been shelved for now, offering a brief window for cooler heads to prevail.
While most Canadian exports were staring down the barrel of a 25 percent tariff, critical minerals like natural graphite were facing a slightly less punishing—but still damaging—10 percent levy. A small mercy, perhaps, but it still would have been an unwelcome hit to our customers and the future of our company, and we’re not out of the woods yet.
For those of us in the world of graphite and the broader Canadian critical minerals industry, the month-long respite is a relief, but it also serves as a reminder that we remain firmly in the crosshairs of global geopolitics that have not been this tense in decades.
This was abundantly clear during my day at the Canadian Critical Minerals Opportunities Forum (CCMOF) in New York this week, where enthusiasm for an electric future from key Canadian critical minerals companies and a US audience could not help but be dampened by prevailing anxiety around trade relations between our two great nations.
If there was any doubt about the power of geopolitical tensions to temper even the mythic enthusiasm of a miner with a dream, one needed only to take the pulse on this particular day in the shadow of a possible trade war that could have no winners.
Geopolitics is of course global and is a weighty issue. The prices of underlying commodities are being kept low by overproduction in China as it leverages its dominance in many critical minerals and makes it close to impossible for many of us to raise the capital to move our projects forward.
We are living this in the world of graphite, where Northern Graphite is actually a producer and is seeking to grow and expand production, and I hear similar frustrations voiced by my colleagues in phosphate and lithium.
Is it overcapacity, or is it manipulation? I think we all know the answer to that. It’s true in phosphates, it’s true in lithium, and it’s certainly true in graphite.
The end result? There are few critical minerals projects that can stand on their own to compete with China – at least not without significant government support, and this creates a vicious cycle. Private investors hesitate because the economics don’t work under current market conditions, and governments are reluctant to invest in mining projects.
That’s where we, as an industry, need to do a better job selling our projects.
It’s not just about competing with China; it’s about providing economic stability, securing supply chains, and ensuring Canada has a stake in the future of critical minerals. Canada needs to step up its support of our projects, but we need to provide tangible returns on that investment, not necessarily in the form of profit, but in jobs, economic activity, and supply chain security.
As we head into the next 30 days, the industry remains in a holding pattern. The uncertainty hasn’t gone away – it has just been postponed. The big question now is what rules will apply in the future. For the moment, everyone is in a wait-and-see mode, hoping that the next round of negotiations doesn’t leave us scrambling once again.
Hugues Jacquemin
Chief Executive Officer, Northern Graphite
Hugues Jacquemin is the CEO of Northern Graphite and has more than 30 years senior management experience growing Specialty Materials businesses for listed Fortune 500 & Private Equity firms.
Perspectives is researched, written and produced by Northern Graphite.
