Canada is well positioned to play a key role as a trusted supplier of critical minerals to the global market, especially for jurisdictions looking to decarbonize energy systems, and this could create opportunities for Canadian mining and exploration companies.mura/AFP/Getty Images
The global mining and exploration industry faces a promising year ahead, shaped by the growing need for minerals and metals to support the energy transition and a renewed focus on mergers and acquisitions as companies increasingly look to diversify. However, issues like geopolitical uncertainty, fluctuating demand for electric vehicles (EVs) and uneven access to capital continue to impact the industry’s outlook.
Michael Faralla, head of global mining investment banking at TD Securities, shares his insights into how these factors are likely to influence the Canadian and global mining landscapes in 2025.
What is your outlook for the mining industry in 2025?
The outlook for mining in general is quite positive. On the precious metal side, we’re at near-record-high gold prices and very strong silver prices. That underpins a robust environment where you’ve got producers with strong cash flows and developers looking to advance projects.
Michael Faralla, Head of Global Mining Investment Banking at TD Securities, Shares His Insights Into How These Factors Are Likely To Influence the Canadian and Global Mining Landscapes in 2025.supplied
On the base metal side, copper prices are strong but have come off their recent highs. Similarly, some of the other base metals like zinc and nickel, have also been quite weak. On the battery metal side, and in particular lithium, prices continue to be very weak, as we have an environment of continued oversupply. There are a number of macro trends to note, including uncertainty around the impact of the new president on the United States’ trade policies on the Chinese economy. There’s also a reduction in the support for EVs and electrification.
When it comes to raising capital, what does the year ahead look like for mining companies?
We’re optimistic after a very strong year for capital raising on the TSX last year that we will continue to see improving access to capital in the mining sector generally in North America. We’re still not seeing as much capital flowing into the juniors and the developers, but I think a big part of the outlook will be development-stage companies seeing improved access to capital as a result of strong commodity prices.
So, looking at all these trends, where will the big opportunities be this year?
We’ve seen a strong pickup in interest for nuclear power, particularly in the U.S. but also in Canada and many countries in the Middle East and in Asia. I think that bodes well for uranium. Uranium did hit very strong highs towards the middle of last year. The price has come off a little bit, but I think part of that is seasonal and part may also just be that the market is trying to understand how the nuclear renaissance will play out in actual fact.
Copper has pulled back from its highs, but I think there’s a fairly broad consensus that copper demand will continue to increase in the future as a result of this electrification and decarbonization theme, which is not going away.
Can you talk about M&A activity in recent years and what that means for the mining industry?
Mining companies of all sizes are looking for ways to grow and diversify their production base. As an example, last year BHP Group made a bid for Anglo American plc. I think that’s indicative of mining companies being focused on commodities and looking for opportunities to grow in critical metals rather than a trend of consolidation. In my view, there’s more of a consolidation trend happening on the precious metal side, primarily because it’s a more fragmented market.
What challenges and opportunities are Canadian mining companies facing right now?
One of the key challenges is tariffs and trade policies. However, Canada is well positioned as a trusted supplier of critical minerals to the U.S. because of our geopolitical alignment and proximity. This could create opportunities for Canadian miners to secure tariff exemptions for critical minerals that are important to U.S. supply chains.
The outlook for mining in general is quite positive. On the precious metal side, we’re at near-record-high gold prices and very strong silver prices. That underpins a robust environment where you’ve got producers with strong cash flows and developers looking to advance projects.
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