Canada is aiming to collaborate with its allies at the Group of Seven (G7) summit to establish a price floor for key minerals in response to China’s market interference and manipulation. China serves as a major supplier of critical metals for energy transition, and Canada believes that without countering China’s dumping of critical metals, it could hamper the West’s ability to establish alternative supply chains.
On Wednesday, January 15th, Jonathan Wilkinson, the Canadian Minister of Natural Resources, mentioned at an event hosted by the Wilson Center in Washington D.C. that Canada has been considering measures such as setting a minimum price to support investments to combat China’s market manipulation.
He emphasized that these measures should take into account environmental and labor standards related to production.
“To compete with China, Canada and the United States will not be progressively lowering labor standards,” said Wilkinson. “But we must acknowledge that our labor standards do indeed increase costs, so this must be factored into pricing discussions.”
China is both a major producer and processor of key minerals, which are essential raw materials in electric vehicles, batteries, solar panels, and certain military equipment.
In order to reduce reliance on China, the United States and its allies have been seeking and establishing alternative supply chains globally.
Wilkinson expressed his hope to cooperate with other G7 member countries to make pricing a key topic of discussion at the G7 summit hosted by Canada in June.
He added that China’s market manipulation led to a significant drop in nickel prices, causing “huge challenges for our Australian friends.”
Wilkinson stated that investors require “a certain level of certainty to build mines and ensure resource security, ensuring that the products they actually produce have market value.”
“If China (the Chinese Communist Party) can easily intervene and depress prices, then the critical minerals we need to develop will never make progress,” he said.
The Canadian minister noted that he has held discussions with officials from the Biden administration and members of the U.S. Congress, and he hopes to engage with former President Trump’s team.